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Forums - Gaming Discussion - PS3 holds all the aces up its sleeve.

Squilliam on 05 May 2009
WiiStation360 said:
PS3beats360 said:

...

You might argue that Sony can not afford price cuts blah blah blah. But the truth is Sony is a huge company and these small losses on hardware is a small drop in the ocean and the extra game sales will more than make up for any insignificant PS3 hardware losses.

...

Discuss

 

Not trying to discount a PS3 price drop this year, which i do think is coming, but:

$100 price drop x 10m+ console sales for a year = $1 Billion dollars in decreased revenue.  That is a large amount of money to any company, not a "small drop in the ocean."

If Sony were to do a price cut and revenue actually fell then they would have been better off not doing a price cut in the first place. In reality if they do a $100 price cut, revenue would actually increase because they would sell more PS3s. The word you're looking for is gross margins on the hardware itself.

If for example the PS3 @$400 gave $40 gross margin and they sold 10M consoles they would have $4B revenue and $400M 'profit'. 

If they cut the price to $300 and then lost $60 per console and they sold 15M consoles they would have $4.5B revenue and they would make losses of $900M and overall the move would cost them a total of $1300M in this hypothetical scenario, moving from a profit to a loss on hardware.

 



Tease.

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Ascended_Saiyan3 on 05 May 2009
rover said:
Also Ascended_Saiyan3, just to put things in perspective, Microsoft doesn't deal in losses, just reduced profits. :)

Last I looked Microsoft has a $20 billion surplus.

Microsoft's "poor earnings" as a company are only making $14 billion in profit *this quarter*.

...and really, does anyone still buy into this IE browser deal? Who cares? Aren't most people here using Chrome, Safari or Firefox? Get over it EU.

Do you think the investors care about what a company has in reserves when it comes to year to year returns?  Please don't tell me you don't know about this side of business.  Do you think Sony doesn't have reserves as well?  Remember Sony has been a giant MUCH longer than MS has.  They just store most of it in product to avoid paying CRAZY amounts of taxes on it.

Think about it.

 



nen-suer on 05 May 2009
rover said:
I love statements like this:

"...and huge list of games exclusive to PS3 which will prove to be much better than any exclusive games on XBox 360"

This is ridiculous on so many levels.

Past hype: HAZE and LAIR will blow the doors off, Heavenly Sword will change the game in SONY's favor, KZ2 is a Halo-killer...

Resistance 2 *severely* under-performed expectations, Motorstorm 2 was effectively still-born.

These 'the future will show' statements are assinine wishful thinking. Walk backwards through the exclusives and work out the average number that actually succeed vs. those that underperform or barely meet expectations. Looking at those numbers puts any 'the future will show' arguments in the proper light.

Wishing things to be so doesn't make things so, neither does ignoring the past undo it.

Don't get me wrong: some of these exclusive titles might actually be good, really good ...or even great, but YOU have no idea and neither does anyone else.

...and that goes for both sides of this particular console war.

Of course, it appears we're not here for reality and fact, we're here for drama and dreams. I will emerge victorious!

Dont be angry just because u cant afford to buy a PS3

 



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nen-suer on 05 May 2009
Ascended_Saiyan3 said:

Sony's losses are only a drop in the bucket when considering MS's losses.  While Sony's losses are NOT small, it's there business model to keep pushing the industry forward with innovative and original games/gameplay.  It's been their pattern since the PS1.  Every new hot 1st/2nd party game will be the one that broke the camel's back for some people.  We shall see if original titles that push the envelope is what gamers want.  If these gamers only want the same old same old games, Sony's strategy may not work.

Personally, I think gamers don't just want the same old same old type games, so Sony's strategy will work.

 

You just ascended to SSJ4 in my eyes



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rover on 05 May 2009

Hang on.

We're talking the survival of companies and you're looking at quality of titles as the *total* arbiter of success?

So a publisher expends $10-20m for a title to be produced and makes back a fraction of that and it's OK?  Man, someone should put you in charge and watch the company rocket to the crypt.

Face it: this is about money, this is about having enough capital to fund the next experiment.  It costs ungodly sums of money to get dozens of people working on a title for years and you think that it's NOT about money?

If a company makes the best TVs in the world and no one buys them, how long will they continue making TVs? 

Quality of entertainment is subjective, but if something catches fire with the public, resonates in some way, then it's a success regardless of someone's arbitrary stamp of 'quality'.

...but if the public doesn't buy it, then it's not likely to be continued. 

And, by the way, LAIR, HAZE, Heavenly Sword, Resistance 2 and Motorstorm 2 are all PS3 exclusives.  These absolutely belong in this discussion! :) The OP says something to the effect of "the PS3 exclusives will be better than any 360 exlusive".  Well, let's take a look at how they've done so far.

And yes, Too Human sucked.  Which is why you'll never see a sequel.

 



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peshkavus on 05 May 2009

sony fan should show more patience, in time they will sit on 2nd place maybe late next year...





and then I woke up.



saicho on 05 May 2009
Ascended_Saiyan3 said:
rover said:
Also Ascended_Saiyan3, just to put things in perspective, Microsoft doesn't deal in losses, just reduced profits. :)

Last I looked Microsoft has a $20 billion surplus.

Microsoft's "poor earnings" as a company are only making $14 billion in profit *this quarter*.

...and really, does anyone still buy into this IE browser deal? Who cares? Aren't most people here using Chrome, Safari or Firefox? Get over it EU.

Do you think the investors care about what a company has in reserves when it comes to year to year returns?  Please don't tell me you don't know about this side of business.  Do you think Sony doesn't have reserves as well?  Remember Sony has been a giant MUCH longer than MS has.  They just store most of it in product to avoid paying CRAZY amounts of taxes on it.

Think about it.

 

This is just brilliant.

 



MikeB predicts that the PS3 will sell about 140 million units by the end of 2016 and triple the amount of 360s in the long run.

madman25 on 05 May 2009

Another hysterical thread...in every sense of the word.



Playing: Borderlands(great co-op,HUGE amount of content),Too Human(better late than never lol),Saints Row 3(Penetrator ftw),Minecraft 360,Harry Potter Lego. 

Patiently waiting for:  Tomb Raider, Borderlands 2

rover on 05 May 2009

...they have their cash reserves sitting in product...

Product which decreases in value faster than cash. 

Products which they aren't able to sell due to the economic downturn and by the time they can sell them, they'll only get a fraction of what they were originally worth.

Products which in the meantime they'll have to warehouse or otherwise store which costs rent (whether they own the buildings or not there are costs with storing and moving product).

What a phenomenally bad idea if this is, in fact, their plan.  Which, btw, I don't believe it is.  I believe their fondest wish is to convert that product for cash and stop the unnecessary hemorraging.

I should state: I don't think the PS3's going anywhere (ie, it won't disappear), neither do I think it'll be 2nd place any time soon if at all, and ultimately nor do I care.

The only ones who care are those who somehow attach some kind of 'I'm a PS3' sticker to their chest and think that if the PS3 wins, they win. 

I'm seriously considering adding a "PS3 is the future: D_3_L_U_D_3_D" tag or something.



Jboy0990 on 05 May 2009

its amazing how everyone became whizzes in Business Principles