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Forums - Sales Discussion - Forbes: Sony is Screwed...Is this article accurate?

HappySqurriel on 13 January 2009
johnsobas said:
alephnull said:
FishyJoe said:
alephnull said:

This is all true, however one should expect MS to start a whisper campaign implying Sony is going to drop the PS3 any day now if it hasn't already. This is one of their favorite strategies. The Lotus guys at IBM hate it as MS has successfully been using it against them for more than a decade now.

 

I wouldn't be surprised MS wants to start a price war. They know Sony is in no financial shape to take further losses. In a war of attrition, the side with the most resources (money) wins.

 

 

There's no question that if MS actually wanted to it could sell every xbox360 for $100. However, they are under extreme pressure as well to increase margins. So the question becomes, how high a priority do you think the xbox division is at MS? From ex-Managers at MS I've talked to, their financial organisation is very similar to that of the Soviet economies complete with their own fake currency to facilitate the meeting of planning targets.

You could easily argue that Microsoft will never have a better chance then they do now to put the dagger in Sony.  They have an unfair advantage right now because they are not as affected as Sony by the exchange rates and they have far more resources.

 

 

I don't think Microsoft has to take any exceptional steps to really hurt Sony though ...

For the holiday season 2009 they can drop the XBox 360 Arcade to the $175 range, the XBox 360 premium to $250 and the XBox 360 elite to the $325 range; and in the holiday season 2010 they can drop the Arcade down to the $150 range, the XBox 360 premium to $200 and the XBox 360 elite to $250. While this is not as agressive as it could be, the price reductions will be balanced out by the cost reductions of the systems.



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megaman79 on 13 January 2009
SMcc1887 said:
NJ5 said:
SMcc1887 said:
Dont Sony have enough assets to see them through if things potentially get alot worse?

I can see buyers for some of their Intellectual Property. However who wil buy their factories for more than peanuts in an economy where most companies are trying to save cash and decrease production rather than increasing it.

Sony is a huge company so that question is too complicated to examine quickly, we'll just have to wait and see what they can do.

One big problem for them is that restructuring takes time to pay off (as the FT article says, for every fired employee, severance pay is usually needed). One can't imagine the complexity of restructuring a company in a short period, I think we're going to read things we can't even imagine right now.

 

Yea, its a complicated time at the moment. We should all hope Sony gets it together.

On top of all this ive just heard that:

Boeing is cutting 4,500 jobs, Land of Leather- a british furniture retailler has gone into administration and JCB is cutting more jobs.

I really dont like the look of what this world will be like once this recessions over

 

Boeing have screwed up though. Theyre still making their super jumbos, customers stilll waiting after 4 yrs.

 



“When we make some new announcement and if there is no positive initial reaction from the market, I try to think of it as a good sign because that can be interpreted as people reacting to something groundbreaking. ...if the employees were always minding themselves to do whatever the market is requiring at any moment, and if they were always focusing on something we can sell right now for the short term, it would be very limiting. We are trying to think outside the box.” - Satoru Iwata - This is why corporate multinationals will never truly understand, or risk doing, what Nintendo does.

nojustno on 13 January 2009

Pachter: ''$299 ps3 in 2009 LOLOOLOLOLOL''

ya right




NJ5 on 13 January 2009
nojustno said:
Pachter: ''$299 ps3 in 2009 LOLOOLOLOLOL''

ya right

I bet he's regretting his timing. Or maybe he just doesn't think much...

 



My Mario Kart Wii friend code: 2707-1866-0957

TacoBoy49 on 13 January 2009

The massive expense of blue ray promotions and nearly every aspect of the PS3 surely has something to do with this. Blue ray and PS3 are fine if they sell well, but if they don't, its losses are colossal.



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WiiBox3 on 13 January 2009

@ seece -
Your point is correct, but slightly off. Nintendo did loose money on each Gamecube sold in the first 6 months, but only in the single digits. Also since it didn't come with any games at that time if the consumer bought just one game they would make back that $$ lost. So essentially yes they did make money from each consumer who bought the Gamecube.

@Snake -
And Nintendo's only big failure was the Virtual Boy.



superchunk on 13 January 2009
Snake said:
so what? this is their first maybe second year where they lost money. Microsoft lost 6 billion on entire Xbox family but you didn't see that on vgchartz. I am not trying to defend Sony here i am just saying Sony its not screwed if it had two bad years. every company in the world has some bad period. When Game Cube was dying did anybody told Nintendo is dead? i think they did, and look at Nintendo now. They are definitivly winning this generation. Some people( (4 actually)on this we site are acting like they were waiting Sony to lose money for their entire life.OMG Sony is losing money!!!!!!!

Note: the last sentence describes only those 4 people

 

Sony's loss isn't just their gaming division, its the entire company as a whole that will show a massive loss that is 4billion lower than what they predicted they would actualy profit.

MS's loss on Xbox was solely in their entertainment division. MS as a whole still profited a lot.

Nintendo has always shown a yearly profit even though their home consoles kept selling less and less each year. Technically last gen Nintendo made more money than MS or Sony's gaming divisions. Note: I am comparing gaming to gaming, not Sony and MS's entire company which involves a lot more than gaming.

Fact is, Sony is in trouble finanicially as a company and they need to make serious changes. Personally I think they need to downgrade their arrogance. Lower prices for their products accross the board. There is no reason they need to be hundreds of dollars more with less features on LCD tvs when compared to Samsung and other top brands. This is the same in all of their products. They always cost more for generally less features.

The only exception I can think of off the top of my head is the PS3 which actually has features that force its price to be high. But, with the lossess accross the entire company, Sony may not be able to reduce its price even when the costs is significatly below the selling price later this year.

idk, guess we'll have to see how things unfold as the year goes on.



WiiBox3 on 13 January 2009

On a related note.. I think that due to this problem we may not see the price of the PS3 drop in 2009, even if the cost to produce the product may drop. The reason they may not drop the price is that so they do not increase their operating loss for the year. It may be short sighted and may cost the company a lot of money and market share in the long run, but the executives could be under heavy fire from the shareholders whom often do not look at the long run.



CMoney on 13 January 2009

@darthdevidem01 - This is a unique story. It is not a duplicate thread. I suggest you ask yourself why there are so many KILLZONE 2 threads. Why do you never question that? It seems your problem is with anything that shows sony struggling.

@snake - It is well documented in sony's financials that the ps3 losses have destroyed every bit of profit ever made on the ps2.



rubido on 13 January 2009
kowenicki said:

If he keeps his job then it could be very important how he sees it in the whole Sony set up... he will need to be saying things that makes investors feel comforted.

Maybe he could say something like:

"I've got good news and bad news. The bad news is that huge companies like us can't compete against small, nimble companies like Nintendo. The good news is that at this rate we'll be the smallest company around."

Sorry for the joke, but I just couldn't help myself. This quote is from Dilbert's boss. I just added the "like nintendo" part to apply to this forum.