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Forums - Sales Discussion - When will PS3 Surpass Xbox360?

You know, since the Playstation 3 is rarer than the Wii, and Xbox 360, it will be more valuable in the future. In that case, maybe we don't want the Playstation 3 to sell more than the Xbox 360, and Nintendo Wii, since its rarity will decrease, since more consoles will exist, and its future value will not be as high.

I guess all the Sony fan boys can brag about how their Playstation 3 is rarer than the Nintendo Wii, and Xbox 360.



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Darc Requiem said:
Legend11 said:
omgwtfbbq said:
Legend11 said:
marc said:
Side Note: Anyone who thinks the Wii isnt competing with the PS3 and 360 is in denial. If it werent for the Wii, the 360 and PS3 sales would be double what they currently are and the PS3 would have sold several more million in Japan. Casual people will not buy multiple consoles but they will buy 1 and without the Wii there they would have chosen one of the others. There arent that many grandma's who own a Wii despite all the talk of how the Wii expanded the userbase. Its not that big of a spread.

I don't believe that. There are a lot of people buying a Wii for themselves that haven't bought another game system in their life, I seriously doubt they would have bought a PS3 or 360 if the Wii didn't exist.

yes, but on the other hand, there are a lot of people who will generally buy one console a generation, and play a few games on that. I know three people who had a PS2 last generation and a Wii this generation. These people would have purchased a PS3 or 360 (eventually) had the Wii not come out.


The keyword there is "eventually" because we both know most of them wouldn't buy one at the current asking price. Marc's statement basically implied that they would all be buying PS3s and 360s now and was the statement I was disagreeing with. Does a $75,000 sports car compete with a $15,000 car? Well they are both automobiles so in a general sense the answer is yes but they both go for a different type of customer and it's the same thing with consoles. The 360 and PS3 are going after a specific kind of customer that wants cutting edge graphics, HD, etc, while the customers going for the Wii aren't looking for those particular things.


I know what your getting at Legend but you analogy is poor. I've seen people reference cars when comparing the Wii to the PS3/360 and its just not accurate by any stretch of the imagination. The car manufacturer probably makes around a $1000 off of that $15,000 sports car. As for the $75,000 model, they'd be making upwards of $30,000 in profit off of the vehicle. The situation is reversed when comparing the Wii and PS3 with the Wii having much higher profit per unit sold and the PS3 having a net loss on each unit sold. In the auto industry the more expensive car makes up for lower sales with a much higher profit margin. Thats not the case with video game consoles.


To add to your point Darc, I'd add that Cars are end products in and of themselves; consoles are not. You need software.

The best way to explain how this changes the analogy would be as follows: let's imagine the 3D0 and SNES as cars. The 3D0 is clearly the Ferrari in that equation; however, there are limited places that Ferarri can go. It can only be driven to a few places in the world. By comparison, the Yugo that is the SNES can basically be driven anywhere.

I don't imagine this generation will be as extreme as the example just given -- I only used it because it's extreme and it makes my point clear. Expensive cars can go everywhere (and usually do everything) that a cheap car can. Expensive consoles cannot. That's a problem.



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Similar discussion article:

http://everygamersblog.com/2007/06/12/how-the-ps3-will-catch-up-to-the-wii/



Darc Requiem said:
naznatips said:
Well, I agree that not EVERYTHING will change. The 1st place this generation has been decided already, almost without a doubt. The chances of the Wii being overturned with the kind of initial success they have experienced are microscopic, especially with their dominance of all markets including a basic monopoly of the whole Japanese market. But, the PS3 is not out of chances to take 2nd place by any means. The deciding factor will be a price drop war between the PS3 and the 360.

Pricing is why I don't think the PS3 will ever catch the 360. I've said it before and I will say it again. When it comes to pricing the PS3 is the X-box of this generation. Sony is completely at the mercy of MS when it comes to pricing.

It is the same situation that occurred between the PS2 and X-box. The X-box was priced well under its manufacturing cost for its entire life cycle. Not only did the PS2 cost Sony less to manufacture than the X-box did for MS, but Sony was also able to reduce the cost of the PS2 more quickly. MS could never approach breaking even on each X-box sale because of the periodic price reductions of the PS2. While Sony was breaking even or taking a small loss, MS was taking a big loss or a really big loss.

For this generation the situation is reversed. MS is already making a per unit profit of the 360, they have been for about 9 months. Sony on the other hand, even with the removal of the EE and reduction of Blu-Ray diode costs, is still taking a significant hit on each PS3 sold. MS could drop the price now and still break even. Sony doesn't have that luxury. Once the switch to 65nm occurs, MS will be making even more profit per unit. MS will have Sony in a difficult predicament, the same one that Sony had them in during the prior generation. They can either match MS' price drops on the 360 and continue to take massive losses or they can stand firm on price and watch as the Wii and 360 pull farther and farther ahead of them. The worse part for Sony is that while MS took massive losses with the X-box to stay on equal footing when it came to pricing, Sony will be taking massive losses with a price cut while still being the more expensive console.

I just don't see how Sony can ever match MS when it comes to pricing. The PS3's sales will always be hampered by its more expensive price. By the time Sony can get the PS3 down to a mass market pricing level, the Uus and X-box 720 will be about to launch. Then the only potential advantage the PS3 has will be gone, it won't be the "most powerful" console any longer. You can bet your life that the Nintendo "Uus" will be $250 and it will look a great deal next to the $200 PS3 and $400 X-box 720.


Since no bothered to try counter point me on this post. I figured I'd give it try.

Paragraph1: The Playstation brand still has more equity than the X-box brand. Outside of the US, Sony has a more dedicated fanbase. This should allow more time to get the price of the PS3 down. With the Wii being unable to easily accept multiplatform ports, this will make the 360 and PS3 co-platforms. That will provide enough games to keep the PS3 a float until the price can be reduced.

Paragraph2: Yes the PS3 is at a disadvantage when it comes to manufacturing cost. However the PS3 is constructed of custom made hardware. The original X-box was made of "off the shelf" components with the exception of GPU. This made it more difficult MS to get the costs of the console down. Its also why MS took a similar approach to Nintendo and Sony this generation by having custom hardware. Sony owns its chip designs. So as soon as the manufacturing cost are reduced the PS3 will see an immediate reduction in its manufacturing costs. The original X-box didn't have that luxury. Even with its GPU MS had difficulty negotiating a lower price point because Nvidia owned the design. Sony cut out the middle man with the PS3 design so they will be able to reduce cost quickly.

Paragraph3: Sony is already looking at producing a 45nm chipset. They will actually be able to implement a 45nm chipset before MS as they already moved to 65nm. This will help reduce cost for the PS3 further. MS isn't giving the 360 the endless budget that the original X-box had. The 360 has to make a profit for MS. So my MS will be slow to reduce the price on the 360. They could have reduced the price of the 360 $50 last year but did not so they could reach profitibility. This hestitant nature to reduce the price by MS can give Sony the time they need to get the PS3's manufacturing cost down.

Paragraph4: Sony will probably lag behind in manufacturing cost the entire generation. That doesn't mean they can't equal the 360's MSRP. As I stated in the aforementioned paragraph, the 360 needs to make a profit. The lag between MS' manufacturing cost reductions and MSRP cost reductions will allow Sony to keep the PS3 at or near the 360s MSRP. As the PS3s price falls, extra features like its built in Blu Ray player will go from being a hinderance to being an advantage. Plus a lower price will make the PS3 more accessible to the games that supported Sony with the PS1 and PS2.

Well there is my counter point post to well my own post. Okay, I have to get back to gaming. It is the weekend and that is when I get most of my gaming done.



Darc Requiem said:

Paragraph2: Yes the PS3 is at a disadvantage when it comes to manufacturing cost. However the PS3 is constructed of custom made hardware. The original X-box was made of "off the shelf" components with the exception of GPU. This made it more difficult MS to get the costs of the console down. Its also why MS took a similar approach to Nintendo and Sony this generation by having custom hardware. Sony owns its chip designs. So as soon as the manufacturing cost are reduced the PS3 will see an immediate reduction in its manufacturing costs. The original X-box didn't have that luxury. Even with its GPU MS had difficulty negotiating a lower price point because Nvidia owned the design. Sony cut out the middle man with the PS3 design so they will be able to reduce cost quickly.


One thing I thought I'd add in here: After allowing Nvidia and Intel to shaft them in gen six, MS learned their lesson. I know they own the Xenon chip but I'm not sure about Xenos. So, while Sony probably has an advantage in manufacturing, it's a small one and it's not because they own the design, MS has that too. If anything, Sony has a manufacturing advantage because they've done it longer and they're better at it.




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As far as I know, MS owns the entire 360 chipset, Rocketpig. Ah I could have used Sony's manufacturing experience in my argument against myself. (Yes it sounds weird to me too) BTW Excellent point Rocketpig.



Darc Requiem said:
 


Paragraph3: Sony is already looking at producing a 45nm chipset. They will actually be able to implement a 45nm chipset before MS as they already moved to 65nm. This will help reduce cost for the PS3 further. MS isn't giving the 360 the endless budget that the original X-box had. The 360 has to make a profit for MS.



 I doubt that Sony will be able to lower the production costs for the Cell as easy as you think. Currently it's Cells are produced by IBM, where IBM can even use defective Cells for the PS-3. But they already deniedf IBM's request if they would still be in the boat for the next cell generation.

They will have more than enough trouble to get a Cell by an independent manufacturer at the current size. And while Microsoft tries to work to cover it's cost, they will not hesitate to enter a price war with Sony to protect their market position.  But at the moment there is no need!

But if the PS-3 will follow the demand and lower the price for the PS-3 (already in the danger not to cover their loss in the whole production run of the PS-3), Microsoft will not hesitate to counter with a price drop and enter the price area for mass appeal. And they would be in a much better position.   



I need to find Wedbush Morgan's pre-$599 analysis of the PS3 costs.

Their analysis was just about 100% spot-on about what costs and retail were going to be. Their big issue was that the cell was, by far, one of the most expensive technologies to reduce the price on, due to it being far more proprietary than the Blue Ray was.

Not only this, the dev time, as cars said, to move the Cell to a 3rd party to produce would be monumental. Setting up the dies to make the PS3s cell would be very difficult to do, and would take Sony months or years, expecially with them vying for 65nm and 45nm processes.

IMO, I'm excited for a PS3 price drop. Not just for the fact that PS3s will sell more, but because the 360 would be forced to drop the price, and make more console sales.



Back from the dead, I'm afraid.

kars said:
Darc Requiem said:
 


Paragraph3: Sony is already looking at producing a 45nm chipset. They will actually be able to implement a 45nm chipset before MS as they already moved to 65nm. This will help reduce cost for the PS3 further. MS isn't giving the 360 the endless budget that the original X-box had. The 360 has to make a profit for MS.



I doubt that Sony will be able to lower the production costs for the Cell as easy as you think. Currently it's Cells are produced by IBM, where IBM can even use defective Cells for the PS-3. But they already deniedf IBM's request if they would still be in the boat for the next cell generation.

They will have more than enough trouble to get a Cell by an independent manufacturer at the current size. And while Microsoft tries to work to cover it's cost, they will not hesitate to enter a price war with Sony to protect their market position. But at the moment there is no need!

But if the PS-3 will follow the demand and lower the price for the PS-3 (already in the danger not to cover their loss in the whole production run of the PS-3), Microsoft will not hesitate to counter with a price drop and enter the price area for mass appeal. And they would be in a much better position.


You misinterpeted my post. I don't believe anything I posted in that particular post. I made a post on the 7th of June that all of the people that said the PS3 would pass the 360 ignored. They just skipped right by it. Or in URnoTE's case misquoted and tried to spin. I was playing the devils advocate. I was arguing a view contrary to my own because it seemed that no one was either able or willing to do so. I do not think the PS3 will pass the 360. You can read why in my post on page one of this thread that goes into why the PS3 will never be competitive on price.



to answer the question, PS3 will NEVER surpass 360 (at least in america and europe and the world combined) Haze and MGS4 are not enough to stop the console even BEFOR Halo 3.

Even I am buying a 360 for it and i'm playing metroid prime 3 right now.

btw add me to your xbox live i'm Myahon



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