Then effectively the will always be around $100USD more than the Xbox360.

So my point is does MS force Sony to make the cut, and lose around 1/2 Billion dollars in the next 12 months (based on 10 million consoles) and extra losses throughout the life of the PS3?

Or do they leave MS to a gap of $100USD?

Now how effective is a $100USD gap in 2-3 years when the cost of bluray is much less?(ie close or under $100)

Well it's already quite clear that Sony won't cut the price of the PS3 until the production costs have come down.
A pricecut before March 31st 2009 will be very surprising, seeing the focus on profitability for SCE.
Sony is finished with the losses on the PS3.

Imo this will give Microsoft the edge in the US, however outside the US it will continue as it is now, since the european pricecut on 360 didn't have that much of an impact.

Bah I remember a discussion with a guy in July 2007. He said Sony would never drop the price before march 2008. That was wrong then and it will be wrong this year.

They will OF COURSE drop the price for christmas. For how much, when exactly or in what form I have no idea. But if MS drops the price in America Sony will follow or they will make a new SKU around the 65nm GPU and make a new price for it. The PS3 won't have a 400$ entry price this christmas. That is sure.

BTW: The last guys you should believe are SONY statements. Nobody hints at price cuts before they happen.

Kyros said: BTW: The last guys you should believe are SONY statements. Nobody hints at price cuts before they happen.

But the first thing we should believe is SONY's fiscal statements, which either indicate SONY doesn't want to excite investors with their game division forecasts or there won't be having a price cut this year.  There is a third option though: they believe that even with a price cut they'll only manage to sell 10 million units this fiscal year(only 0.5 million more than last year iirc).

Kyros said: A pricecut before March 31st 2009 will be very surprising Bah I remember a discussion with a guy in July 2007. He said Sony would never drop the price before march 2008. That was wrong then and it will be wrong this year. They will OF COURSE drop the price for christmas. For how much, when exactly or in what form I have no idea. But if MS drops the price in America Sony will follow or they will make a new SKU around the 65nm GPU and make a new price for it. The PS3 won't have a 400$ entry price this christmas. That is sure. BTW: The last guys you should believe are SONY statements. Nobody hints at price cuts before they happen.

 

You don't follow the news very often, do you?

At the presentation of the FY 2007 figures and later by Sony's CEO it was very clear that profitability is now the main strategy for Sony SCE. A pricecut will undermine that strategy. Shareholders won't like that.
You might not believe me, but at this moment profitability is the main focus, not marketshare. Sony already lost 3.3 billion dollars on the PS3, they won't go further than that.

The situation is much different from 2007. Then there were no official statements from Sony saying things must change and it was clear that the PS3 was a disaster and needed the pricecut. PS3 is doing reasonably well right now, so why on earth cut the price.

I don't have a clue where you get the "off course" from. Sounds more like wishful thinking to me. Sony only cares about Microsoft to a certain extend. Their own business and stakeholders are much more important.
Besides the shipment forecast already shows that they won't cut the price, since they'll easily make that target with the current price.

About your last statement: If Sony gives these official statements they are very beliveable since investors will read the same statements and base their investment decision on that. Sony will need a very good explanation if they cut the price and make a loss on the SCE division.

Sony have two choices, drop price, lose money and try to keep market share. Or keep high price, lose market share and lose money.

They are fucked with the ps3.

I think Sony has to worry more about making a profit and less about competing with Microsoft

Sony won't price cut unless they think they have no choice but to do so IMHO. If the impact of a 360 US price cut is something they think they can ride out they will, but if not reacting means losing even more over time vs some short term losses to keep PS3 in the game in US then they would of course consider a (perhaps small) price cut.

All businesses will change their view on anything if the market and operations dictate it, but there is no doubt they are reluctant to take any more price cuts for the moment.

Surprise! And you know what. They will lower the price anyway. If MS does a price-cut in the US, Sony will do the same, possibly a while later. Getting profitable is one thing, but having a good market share so developer start making the games that make the profit for SCE in 2009/2010/2011 is equally important. Besides an effective 100$ price cut since Nov. 2006 (40Gb and 20Gb SKU are pretty comparable) isn't exactly dislocating their arm.




That by-sentence was rather unnecessary. You are arguing pretty strongly on some investor guidance pamphlet that doesn't make any specific announcements on how they they try to achieve profitability.

In the end we only have to wait 6 months. Doesn't have anything to do with wishful thinking either I have my PS3. There will simply be a price cut before christmas. That's a given. (And I can say that without following "the news" .

Kyros said: it was very clear that profitability is now the main strategy for Sony SCE. Surprise! And you know what. They will lower the price anyway. If MS does a price-cut in the US, Sony will do the same, possibly a while later. Getting profitable is one thing, but having a good market share so developer start making the games that make the profit for SCE in 2009/2010/2011 is equally important. Besides an effective 100$ price cut since Nov. 2006 (40Gb and 20Gb SKU are pretty comparable) isn't exactly dislocating their arm. You don't follow the news very often, do you? That by-sentence was rather unnecessary. You are arguing pretty strongly on some investor guidance pamphlet that doesn't make any specific announcements on how they they try to achieve profitability. In the end we only have to wait 6 months. Doesn't have anything to do with wishful thinking either I have my PS3. There will simply be a price cut before christmas. That's a given. (And I can say that without following "the news" .

 

You're right about that sentence. I was about to delete it, but you already quoted it. Sorry for that, indeed not necessary at all.

However I still don't see you giving any arguments as to why they will cut the price and therefore lose even more then they already do.
The financial shipment forecast however holds firm evidence that unless the 10 million PS3's in this financial year won't be sold there is no need for them to do a pricecut. After all that is their desired sales figure for this year.

About your developer statement: you do realise that with a $100 pricecut Sony needs at least 10 3rd party games sold per PS3 to recover that pricecut?
Again: at this moment their strategy is about profitability. They want marketshare, but not at extra costs.