| vivster said: Typical business analyst only thinking short term. The PS5 discless version is the best console that will be on the market for the whole generation and it's gonna set a precedent for the future. |
Possibly. And for the collector, what's stopping them from buying a physical version of a Limited Edition of a game? Win-Win?
I mean other than digital codes for games you can find on web sites like Amazon, Sony is pretty much the exclusive retailer for selling games on the PS5 digital edition. That's a lot of power, worth the initial loss.
http://www.youtube.com/watch?v=F1gWECYYOSo
Please Watch/Share this video so it gets shown in Hollywood.
| RolStoppable said: Here are Pachter's statements: “I think Sony really blew it with that, because as far as we can tell, the cost of making a PlayStation 5 is $450, so they are breaking even on the $500 version, but losing $40 or so on the digital version,” he said. “A disc drive isn’t worth that much. So they’re losing $40, but they gain $6 more per digital game than they would gain otherwise. So you would have to buy a lot of games to cover up the loss, and I just think it’s unlikely many will buy that many games.” Already a wonky analysis because he leaves out first party game sales, which earn notably more revenue per game for Sony, and ongoing PS+ subscriptions. Covering up the losses that an early PS5 adopter brings initially, that shouldn't be a problem in the long run. “I actually don’t think many consumers will want to save the money, I think most would rather have the disc drive on hand so they have the option to take their game to their friend’s house or trade it in or whatever,” Pachter said. “So I think they blew it with the Digital Edition, but it’s hard to tell early numbers, because it’s all sold out anyway, and we don’t know how many of each they made. But I think over the long run, they’ll sell and make fewer digital editions.” The closest Pachter comes to a sound analysis is with his last sentence, but even there he puts the cart before the horse. What we've learned from the 20GB PS3 is that Sony will limit the production of their lower-priced SKU because they are taking a notably bigger loss on it; the point of having a cheaper SKU is to advertise in a more favorable way ("PS5, starting at $399."). That's why Sony will make and sell fewer digital editions, not the other way around ("sell and make"). |
Exactly and we can complement this with all Playstations so far have been launch with a loss leading strategy going from about 50 for PS4 up to almost 300 on PS3 so they breaking even on PS5 with disc and taking 50 or less loss on PS5 DE is actually a first for them. And that is cost on launch, it will get down and possibly will be fast, driver won't drop as fast as the rest so I see no issue for Sony. The only thing that I have seem at most is people complaining that the PS5 with disc is much more expensive and that the driver doesn't cost 100 (so they are basically inverting everything and ignore the cost to make, but that is expected since customers don't really look at that, they only see the price and what they get, with time though that should pass as well).
duduspace11 "Well, since we are estimating costs, Pokemon Red/Blue did cost Nintendo about $50m to make back in 1996"
http://gamrconnect.vgchartz.com/post.php?id=8808363
Mr Puggsly: "Hehe, I said good profit. You said big profit. Frankly, not losing money is what I meant by good. Don't get hung up on semantics"
http://gamrconnect.vgchartz.com/post.php?id=9008994
Azzanation: "PS5 wouldn't sold out at launch without scalpers."
| The_Liquid_Laser said: I think Sony "blew it" simply by offering a digital only edition. I know why they did it. They are worried about Microsoft. Microsoft's strategy is to destroy Gamestop and the used game market in general. They have been trying to do this since the initial presentation of the XBox1 when they included DRM that restricted the use of used/shared games. They are trying another approach now with Gamepass, but it is all to destroy the second had market. Sony does what they always do. They hedge their bets. They see Microsoft or Nintendo doing something ballsy and they put out something kind of like it "just in case". That's what this all digitial console is. Microsoft has a cheap new system with a cheap streaming service, so Sony puts out a cheap-ish digital system just in case Microsoft's business model really takes off. The problem with going all digital is that it screws over retailers. It doesn't just screw over Gamestop but all retailers. Microsoft is fine screwing over retailers, but Sony should not be fine. Retailers are only selling the consoles, because they can sell games. Retailers only make profits on the games. Without physical games what will happen to the hardware? The price will have to go up to near PC prices. Retailers will demand they make money on hardware or simply stop selling it. Again, if consoles end up priced like PCs, then Microsoft wins. That ends up helping the PC market a ton. Screwing over retailers is what will make Microsoft win. But Sony loses in this scenario. Sony's business model works, because console hardware is a lot cheaper than PC hardware. An "all digital" future is one where Sony loses permanently. So, it kind of doesn't matter if the all digital system is priced at $450 or $400. Sony is losing just by offering it. They need to do what they can to keep physical media around. Because the all digital future will drive up console prices, and that helps Microsoft, because it helps the PC. |
No.
Sony did it because it's evident that the digital market is growing that's all there is to it.
And if you want to talk about all digital gaming, well Sony has also tried it with the PSP Go back in 2009 so don't think that Sony is doing this to compete with MS or Nintendo. The market is there, you have to be an idiot to not think a digital-only console isn't worth giving it a try, and also that's why they all have digital stores to begin with or else they might as well keep with their games as physical.
If anything, MS tried to jump the gun with the Xbox One S All-digital when it came late this gen while everyone has already their physical/digital library of games. Bringing an all-digital console at the beginning of a gen, at this day of age where the digital market is strong, it's just inevitable that's all, and the best way to test the market.
I don't know what sort of business you're thinking that an all digital future is where Sony loses, people on this thread have already done the math and Sony will be fine with their all digital console. Let alone Sony market team is better at the math than any of us here. It's like you think Sony is incapable of progress and change or something.
As for retails, both MS and Sony are fine, but retails already know this business too. Why do you think they still sell digital cards? If they didnt think they'd make money then they might as well not sell any PSN/XBL/Apple/Google cards etc. Retails know that video games (or anything digital) aren't a big profit to them either but even if they're just selling the console alone what retailers are looking for is more foot traffic. Getting more people in the store so that they buy other things too. Why do you think Gamestop is the only one that's really hurting? Cause they mainly focus on video games whereas other retailers don't. They can make money from other products but as long as they can get people to come in their store.
Ka-pi96 said:
Common sense should stop them from buying a product they are literally incapable of using. But then if they're a "collector".... yeah... |
For collectors the discless version is actually the better deal. That way they aren't even tempted to actually use their mint packaged games.
If you demand respect or gratitude for your volunteer work, you're doing volunteering wrong.
vivster said:
For collectors the discless version is actually the better deal. That way they aren't even tempted to actually use their mint packaged games. |
That's true! I kind of wished I never opened my PS4 Gravity Rush remaster. And some of the free games I got on PS Plus I also have physically that I never opened (mainly because I bought them before it came to PS Plus but I never even tried to play it yet lol)
Ka-pi96 said:
Common sense should stop them from buying a product they are literally incapable of using. But then if they're a "collector".... yeah... |
Common sense should tell you that you cannot hold a digital art book in your hand.
Common sense should tell you that you cannot rip a digital soundtrack at any quality you want.
Common sense should tell you that you cannot display a virtual 3D image of a statue on any shelf.
Etc...
Come on, dude. Lets not be so jaded.
How much money will Sony make from the few gamers who will purchase a PS5 digital to play Fortnite, Call of Duty Warzone, Apex Legends and other free to plays? At least not too many people play those.
...to avoid getting banned for inactivity, I may have to resort to comments that are of a lower overall quality and or beneath my moral standards.
Sony is establishing a price position and wants the mind share of the customer to think that the PS5 is actually a $399.99 consoles when in fact they are actually selling a $499.99. Considering the smaller number of PS5 all digital and the marketing boost from having a $399.99 console, it's a very smart move by Sony. Besides, they will quickly recover the extra $50 lost on the sale by selling games digital and removing that many games from the used sales market.
Ka-pi96 said:
Common sense should stop them from buying a product they are literally incapable of using. But then if they're a "collector".... yeah... |
Aren't you guys aware that there is now a digital version of collector's edition?
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