| Gamerace said: Marketing and R&D costs have to be contributing to the loss too. Also some games (Liar) may have cost more to develop than they ever earned back in sales. Is that $130 lost/system based on the last quarter or all year too? Cause obviously it was greater than that at the beginning of the fiscal year. |
Liar? Now that could be an interesting game....
Back when Sony was selling the 60gb unit they said it would be breaking even in March of this year. Once you take out the card readers, 2usb ports and the PS2 CPU/GPU you have the cost of their main selling system the 40gb PS3.
Let's just hope that software and accesories sales can bring Sony a healthy profit in the future! That said, Sony has to be getting some money for the Blu-ray property, maybe not from movie royalties but from hardware makers, and I'm sure movie royalties will exist soon.
| Dragon007 said: This was over the course of a year, of course it's gonna show a loss. It includes sales of the 60GB and even the European launch of the PS3. |
No it doesn't. European launc was in Sonys FY 2006. @Topic: People, notice that the estimation was last years average and doesn't mean that they are manufacturing losses. They are estimated losses overall from PS3, averaging over the year. Meaning that of course they aren't currently losing that much. Although, the 1,2 billion from PS2 and PSP seems plausible, i still find it a little high.
Ei Kiinasti.
Eikä Japanisti.
Vaan pannaan jalalla koreasti.
Nintendo games sell only on Nintendo system.
that's a huge loss
| MikeB said: @ mztazmz It was said that Sony was losing about $300 per PS3 at launch, that was 18 months ago. The iSupply report only stated PS3 Components costed $850 around launch. If correct you still have to build the console and add a lot of additional marketing, R&D, support, retailer share, etc, costs. |
Very intelligent reply. must commend you on that as they are quite rare these days.
and yes it is a console built for the future. it's funny as i made a thread along time ago based on the idea that maybe sony doesn't want to sell a shitload of ps3's at huge losses. sony's gaming division would go bankrupt if say, 30 million people bought ps3's at a $300 loss per console! they realize that they'll lose money on the first few million early adopters, then try to get to a breakeven point ASAP as hardware costs go down. they knew that they would eventually get the cell down to 65nm and even 45nm, reducing costs on the cpu and in turn reducing costs on the cooling system.
| MikeB said: @ Hephaestos I don't see the point of making a console build for the future and have it stagnate 2 year so that it doesn't cost too much.... why not release it 2 years later with all the spotlights on it? 1) Winning the HD format war, having to built a HD DVD based PS3 later on would have been bad for Sony. (Blu-Ray movie royalties, Blu-Ray technology royalties, long term technical advantages like more data per layer, scratch resistance is very beneficial to a console, better streaming technology, etc) |
this is a very good analysis. sony as a company tends to think in the long term. that's why so many people can't understand why they do things the way they do. things like bluray and cell might seem unnecessary today, but 2 years from now everyone will be praising sony for planning ahead while a certain other company continues playing catch-up by releasing overpriced addons.
Unfortunately, hardware losses are not the only expense that a console manufacturer faces ...
People forget how expensive marketing a console can be, in particular when you favour television ads like Sony does; a single 30 second spot on a national broadcast at prime time can be as much as $1 Million. In 2001 Nintendo spent $500 Million on marketing for the Gameboy Advance and Gamecube and I don't recall seeing ads for the Gamecube and GBA as much as I have seen PSP and PS3 ads.
The other consideration is game development costs. Sony has bragged many times that they have more developers than any other publisher in the world; when you combine this with games which cost a lot of money to make and are constantly delayed, the higher costs and lowere revenue can really put game development deep into the red.
So basically this whole post is speculation.
We don't know how much profit PSP/PS2 made, and we don't know how much is lost on every PS3 sold. It's just someone saying that PSP/PSS2 could have made 1.2 billion in profit, and PS3 could have lost a few billion, but again, no concrete figures, and no reasoning behind all of this...
Why are we discussing this again?
More sentiment below that a PS3 price cut is unlikely this year and that Sony is taking a little more short term views for their balance sheets and shareholders :
http://www.gamesindustry.biz/articles/ps3-price-cut-unlikely-this-year
PS3 price cut unlikely this year
Sony's focus on profitability means a PlayStation 3 price cut is unlikely to happen this year, according to analysts Lazard Capital Markets.
In its recently released end of financial year results, Sony revealed a focus on achieving profitability in its PlayStation brand and rolling out online services, such as PlayStation Home.
As the company's priority in chasing unit market share against rivals Microsoft and Nintendo is lower, a price cut for the PS3 this year is unlikely, said the analyst.
"Console market share appears to be less of a priority; price cut less likely," explained Colin Sebastian of Lazard Capital Markets.
"On its earnings call, Sony management indicated the company is now more focused on achieving profitability in the PlayStation segment... Importantly, management comments also suggest that a price cut is less likely on the PS3 this year, at least in the near term."
Sony recently announced it expects to ship ten million PS3 units worldwide this year, an 8 per cent increase year over year.
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