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Forums - Sales Discussion - Why reports of the decline of the PS3 have been grossly exaggerated.

shanbcn on 29 November 2008
NJ5 said:
shanbcn said:
Do PS3 need a price cut? Hell yes! And its already almost confirmed to come in march. 360 was way cheaper then PS3 in EU before but now its dirt cheap. And last couple of weeks have shown Sony that they can't afford to have bigger difference in price between PS3 and 360. Anyway 360 still will be cheaper but the difference will be smaller.

Almost confirmed?

Earlier this year, when Sony kept telling their investors they were focusing on profitability in the games division, some people kept saying a Christmas price cut was guaranteed. I doubted it back then, and I doubt it now too.

 

 

Back then 360 didn't outsell PS3 in Spain and Italy.



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NJ5 on 29 November 2008
shanbcn said:
NJ5 said:
shanbcn said:
Do PS3 need a price cut? Hell yes! And its already almost confirmed to come in march. 360 was way cheaper then PS3 in EU before but now its dirt cheap. And last couple of weeks have shown Sony that they can't afford to have bigger difference in price between PS3 and 360. Anyway 360 still will be cheaper but the difference will be smaller.

Almost confirmed?

Earlier this year, when Sony kept telling their investors they were focusing on profitability in the games division, some people kept saying a Christmas price cut was guaranteed. I doubted it back then, and I doubt it now too.

 

 

Back then 360 didn't outsell PS3 in Spain and Italy.

That still doesn't convince me that they're willing to throw hundreds of millions (or billions) at the gaming division when Sony as a whole is in hard times.

 



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leo-j on 29 November 2008

@NJ5

What makes you think Sony wont break profit by Q109?



 

mM
shanbcn on 29 November 2008
gebx said:
Squilliam said:

What we're seeing with PS3 sales isn't some end of days phenomenom. All we're seeing is that the number of people who are willing and able to purchase a PS3 at the price of $400 being tapped out, and thus a pricecut is required to stimulate sales again. Thats pretty much it. Sure there are still people who will buy at that price, but the numbers of those people will decline especially after the rush this year so obviously a price cut is needed.

But how can SCE afford such outlanding expenses such as a price cut in these harsh times?

If we assume everythings in U.S dollars for a moment, and that Sony sells 10,000,000 PS3s with a price cut. At $400, they would have recieved $4,000,000,000 of revenue whilst at $350 it would be $3,500,000,000. A shortfall of about $500,000,000 (Im assuming the same number sold because I don't want to complicate things)

Killzone 2, Uncharted 2, MAG, Gran Turismo 5, God of War III, the agency.

If you could think of a reason these games will sell fewer than 15,000,000 combined on a userbase approaching the 30,000,000 mark please raise your hand and tell me. Now thats out of the way, if you assume a publisher cut of $38 per game that gives you a total revenue of: $570,000,000 minimum.

So the PS3 needs a price cut to stimulate sales, fact. The PS3 can afford a pricecut because this is likely to be the biggest year for sales for SCE on the PS3 for a while and even with a crappy exchange rate one can easily subsidise the other.

The end. What do you think?

 

 

 

 

/raises hand with red flags...

I have a few reasons

A) Userbase is approaching 20 million.. won't hit 30 million till the next holiday.. so not all the games mentioned will have that big of a userbase
B) Killzone 2 could pull Resistance 2.. but even being generous it won't beat Call of Duty WoW sales
C) Uncharted 2 could pull a Motorstorm 2
D) MAG could very well end up like Frontlines..
G) The Agency... MMO...

On the other hand GoW3 and GT5 will be huge... my guess is a combined 8 million between the two of them..

My guess all 6 games mentioned will sell 10-12 million combined by Jan 2010

 

Just 10-12 million between thes games by Jan 2010? With GT5 releasing WW even 15 million is on lower side.

 



Oyvoyvoyv on 29 November 2008
shanbcn said:

Just 10-12 million between thes games by Jan 2010? With GT5 releasing WW even 15 million is on lower side.

 

Do you mean for GT5 alone, or in total for the 4 (with MAG and the MMO not being very important).

If GT5 alone, I believe you are overshooting it by 50%, if for all, I think you are pretty much correct.

 



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NJ5 on 29 November 2008
leo-j said:
@NJ5

What makes you think Sony wont break profit by Q109?

Several things:

- Some calculations which I have posted in a few threads
- A quote I found a few days ago from their CFO (Chief Financial Officer) essentially arriving at the same conclusions as me
- The fact that Panasonic yesterday forecast they're going to be in the red (losing money) for the last half of their fiscal year. Panasonic is suffering from the same problems as Sony, but Sony had even worse profit margins than them recently.

 



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shanbcn on 29 November 2008
Oyvoyvoyv said:
shanbcn said:

Just 10-12 million between thes games by Jan 2010? With GT5 releasing WW even 15 million is on lower side.

 

Do you mean for GT5 alone, or in total for the 4 (with MAG and the MMO not being very important).

If GT5 alone, I believe you are overshooting it by 50%, if for all, I think you are pretty much correct.

 

He said between these games, Killzone 2, Uncharted 2, MAG, Gran Turismo 5, God of War III, the agency.

Now 6 games just need to sell 2 million each to reach his highest figure of 12 million. Remember list include GT5, GOWIII and KZ2.

 



leo-j on 29 November 2008

We will see, but I do expect a price cut march, a significant one across the board, and some bundles.



 

mM
Kantor on 29 November 2008

You know, if they just took out WLAN, they could easily cut the price by $100 with minimal losses. Then they could go the 360 path and release a separate WLAN adapter.

And a $100 price cut would be massive.



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Instance56 on 29 November 2008

Sony needs to decide if they want to come 3rd or a distant 3rd. So they better cut the price soon if they dont want to be a distant 3rd. that simple. And the user base is far from approaching 30mill lol.