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Forums - Sony - Perry: "Sony has no chance of making money on the PS3"

Grampy on 25 August 2008
jman8 said:
Grampy said:
forevercloud3000 said:
Some of you are fairly dense. Most systems these days never make a profit from the actual console. They make majority of it from royalties on games. It doesnt matter that they spent up all the money made from console sales of the PS2. They still have not spent up the money from the mountains of money made from royalty game sales.

The PS2 spent majority of the money made on the PS1 as well if you didnt know. Why should the PS3 be any different? All this is is marketing spin to have people's trust of Sony waver.j
Sony will make their money back in a few ways...
-from game royalties on their system
-soon the system will be able to break even, or at least make a small profit
-Now that blue ray is nxt in line to take the format throne, it will be bringing them in mounds of cash(and it is not owned by like 10 companies, its about three. Sony, Phillips, Pioneer, these are the creators)I think you are confusing it's supporters for the founders. There is a BDA that all support BDA but it is a creation of the companies I named before meaning they get much larger cuts.
-Home advertisements and saleable goods within the product
etc

Sony has nothing to worry about in the long run, this is why they sold it at a loss in the first place

You had better loan your rose colored glasses to the International Business Community which does not share your confidence in Sony's profitabilty or prospects.

For example The International Business Times July 29,2008

http://www.ibtimes.com/articles/20080729/sony-profit-plunges-from-year-earlier.htm

Sony profit plunges 50 pct from year ago

TOKYO - Sony Corp. said Tuesday its April-June profit plunged to 34.98 billion yen ($326.9 million)--about half that recorded a year ago--as a strong yen, the absence of "Spider-Man 3" revenue and faltering results at its cell phone operations battered earnings. Bottom of Form

The Japanese electronics and entertainment company, which makes the Walkman player and the PlayStation 3 game machine, had recorded 66.46 billion yen in profit for the fiscal first quarter the previous year.

Price competition in its core electronics sector also led to Sony's worse-than-expected quarterly performance. Analysts surveyed by Thomson Financial had forecast a 52 billion yen ($486 million) profit.

Sony also lowered its full year profit forecast Tuesday to 240 billion yen ($2.24 billion) from an earlier 290 billion yen ($2.71 billion), by expected poor results at its Sony Ericsson mobile joint venture and a pessimistic outlook in electronics.

 

In Other Words the Game Division is doing better than most of their other divisions and we all know "how well" that's doing. Sony could actually be in fairly serious trouble.

  

 Where in the article does it say that the game division is doing better than most others? It doesn't. The game division is doing terribly. They only posted a $51 million profit last quarter and that was with the release of MGS4, GTA, and GT5:P. It was the other parts of Sony that pulled in the other $275million. This quarter they'll probably lose money in the gaming division w/out any major software releases except Madden and maybe Star Wars. However, last quarter's results are promising in the sense that the games division is on the right track. Without a doubt, the holiday season will see a huge profit. And it does appear that the division is on track for meeting Kaz Hirai's goal of making the PS3 profitable by March '09. Once the PS3 reaches that point, the games division will start bringing in serious money and will help prop up Sony as a whole.

People have been predicting doom and gloom for Sony for ages. In the PS1 and PS2 era, Sony survived largely b/c of the game division. During the launch of the PS3 when the division was bleeding rivers of money, Sony was still very profitable b/c of its TV division. Pretty soon the game division will start taking up the slack again. Sony's diverse products means it's going to be around for a long time coming.

 

 Sorry, while I admit they never said that the game division is doing better than the others in so many words, I thought it was apparent from the fact that this excerpt, as well as the whole article never mentions the disastrously bad situation in the gaming division as a cause of Sony’s woes. If a division that, in your words, “is doing terribly” doesn’t even rate a mention on the laundry list of the things hurting the company then I take that to mean that, in comparison, they are considered, not to be a problem.

 



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markers on 25 August 2008

gotta spend money to make money :]



perpride on 25 August 2008

To David Perry: Shut the fuck up and develop video games. When you make your way up in a real company, maybe you will be given the opportunity to create a console.



HappySqurriel on 25 August 2008
perpride said:
To David Perry: Shut the fuck up and develop video games. When you make your way up in a real company, maybe you will be given the opportunity to create a console.

 

What a mature response to an obvious observation and a valid point from another companies executive ...



playnext3 on 25 August 2008

this is stupid.im sure they will but i know they will not recoup the cost of its own development



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Jason77 on 25 August 2008

Sony making their money base on the sell of home entertainment system and blu-ray disk . PS3 is part of marketing strategy.



coolestguyever on 25 August 2008

Who the hell is Perry?

is this katie perry? she thinks the PS3 won't break a profit. All i know is she kissed a girl. I don't know what to think.



TheBigFatJ on 25 August 2008
Jason77 said:
Sony making their money base on the sell of blu-ray disk and home entertainment system. PS3 is just a step stone.

How exactly will that work?

Sony has a foothold with BD, /assuming/ it becomes popular.  The problem is that it is very expensive to get a BD player right now -- more expensive than it was when HD DVD was still around.  People see very expensive players and very expensive discs, and they don't see why they need to switch from DVD.  Some of them wouldn't even notice a quality difference on their HD TVs.  Hell, I've seen people struggle to notice a difference between standard def broadcasts and HD broadcasts -- and there is a huge, night-and-day difference.  Whereas the difference between BD and DVD is more like night-and-dusk.

The point is that Sony always made a ton of money on their consoles.  And this time there was some bad engineering and some bad calculations and now they're losing a ton of money.  And they're unlikely to recover it with the PS3.

 



Jason77 on 25 August 2008

I think Sony is more looking on the long term marketing

Which some report also show although blu-ray is not popular now, but there is a increasing trend

Just look at why sony use blu ray on Ps3, why don't like 360 using DVD, which is also much more cheaper.

I amit that sony make a mistake that the high price of PS3 is a loss, that is why they now move away the BC and making a cheaper but still high quality console.



HappySqurriel on 25 August 2008
Jason77 said:
Sony making their money base on the sell of blu-ray disk and home entertainment system. PS3 is just a step stone.

 

I just want to know why everyone thinks "Blu-Ray" is some sort of super money maker for Sony?

Of all costs associated with Blu-Ray players and discs, the licencing fees on most formats have never been that large of a portion of the total costs; and there are hundreds of companies who get a cut for this due to their involvement with the Blu-Ray consortium, or the technology that is licenced to produce the Blu-Ray format. On top of this, Sony and other companies have had fairly large expenses in order to make Blu-Ray as successful as it currently is ... The hundreds of millions of dollars that were paid in order to get studios to become Blu-Ray exclusive mainly came out of the pocket of a couple of companies (including Sony).

 

 

The reason companies like Sony push formats like Blu-Ray has nothing to do with the money they make (directly) from Blu-Ray. The reason they push it is because a new format provides a need for new hardware (like Televisions and surround sound systems), and encourages people to re-buy the same movies they already own ...