RUMOR - PS3 Price Cut to be announced TODAY by SCEE!

Seihyouken

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Seihyouken on 10 August 2009

Vetteman94 said:

Alby_da_Wolf said:

Vetteman94 said:

Alby_da_Wolf said:

RageBot said:
But if the slim's production cost is 252$, and they sell it at 300$, how do they lose money?

It depends on how that $252 is calculated: the old estimates we saw in the past, like the ~$450 in October 2008 included warehousing, shipping and retailer profit, if the current $252 includes only production and, maybe, warehousing and shipping, you must take into account that retailers will want a bigger than $48 profit on a $300 retail price, so Sony would initially lose some tens $ per unit. Obviously, when production is at full capacity, Slim will give more savings than the normal evolution of Fat production.

Actually I have heard, from members of this website, the retail markup is only about 5-10%. So it would still make Sony money, but that is if it includes the warehousing and shipping and packaging and such.

I'm puzzled: stores that sell a lot of games too may find a markup so low acceptable, but appliances stores selling mainly HW won't find it appealing, while for assembled computers retailers' margin is quite low (but they recover on peripherals), for consumer electronics it's usually quite high. Oh, suddenly it springs to my mind that I'm in EU, and strong Euro united to "creative" exchange rate applied by traders (the parity applied isn't justified by VAT, it largely exceeds it) automatically gives them an higher margin than in more competitive markets like USA.

But the PS3 isnt HW only like most other appliances. From what I have been told they make the most money on peripherals and games.

@sully1311

Is this not the big conference coming up in Cologne, Germany?

http://www.gdceurope.com/index.html

http://www.gdceurope.com/events/gamescom.html
http://www.gamescom-cologne.com/thefair/entertainment_area/dates_opening_times.php

There are two parts to the big event coming next week in Cologne, Germany. The first part is GDC Europe 09 which is a private press event where developers meet and communicate within the industry. Directly afterward is Gamescom which is a public event similar to E3.

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Vetteman94 on 10 August 2009

Seihyouken said:

Vetteman94 said:

Alby_da_Wolf said:

Vetteman94 said:

Alby_da_Wolf said:

RageBot said:
But if the slim's production cost is 252$, and they sell it at 300$, how do they lose money?

It depends on how that $252 is calculated: the old estimates we saw in the past, like the ~$450 in October 2008 included warehousing, shipping and retailer profit, if the current $252 includes only production and, maybe, warehousing and shipping, you must take into account that retailers will want a bigger than $48 profit on a $300 retail price, so Sony would initially lose some tens $ per unit. Obviously, when production is at full capacity, Slim will give more savings than the normal evolution of Fat production.

Actually I have heard, from members of this website, the retail markup is only about 5-10%. So it would still make Sony money, but that is if it includes the warehousing and shipping and packaging and such.

I'm puzzled: stores that sell a lot of games too may find a markup so low acceptable, but appliances stores selling mainly HW won't find it appealing, while for assembled computers retailers' margin is quite low (but they recover on peripherals), for consumer electronics it's usually quite high. Oh, suddenly it springs to my mind that I'm in EU, and strong Euro united to "creative" exchange rate applied by traders (the parity applied isn't justified by VAT, it largely exceeds it) automatically gives them an higher margin than in more competitive markets like USA.

But the PS3 isnt HW only like most other appliances. From what I have been told they make the most money on peripherals and games.

@sully1311

Is this not the big conference coming up in Cologne, Germany?

http://www.gdceurope.com/index.html

http://www.gdceurope.com/events/gamescom.html
http://www.gamescom-cologne.com/thefair/entertainment_area/dates_opening_times.php

There are two parts to the big event coming next week in Cologne, Germany. The first part is GDC Europe 09 which is a private press event where developers meet and communicate within the industry. Directly afterward is Gamescom which is a public event similar to E3.

Ahhhh. so they are 2 seperate conferences running together. Isnt Sony's 3 hour conference on Aug 18th? Which would mean it falls during the GDC portion, which would mean I am correct. Correct?

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Alby_da_Wolf on 10 August 2009

Vetteman94 said:

Alby_da_Wolf said:

Vetteman94 said:

[...]

Actually I have heard, from members of this website, the retail markup is only about 5-10%. So it would still make Sony money, but that is if it includes the warehousing and shipping and packaging and such.

I'm puzzled: stores that sell a lot of games too may find a markup so low acceptable, but appliances stores selling mainly HW won't find it appealing, while for assembled computers retailers' margin is quite low (but they recover on peripherals), for consumer electronics it's usually quite high. Oh, suddenly it springs to my mind that I'm in EU, and strong Euro united to "creative" exchange rate applied by traders (the parity applied isn't justified by VAT, it largely exceeds it) automatically gives them an higher margin than in more competitive markets like USA.

But the PS3 isnt HW only like most other appliances. From what I have been told they make the most money on peripherals and games.

[...]

I know, but here we have a lot of appliance stores that mainly sell appliances and very little SW, so a device with low margin on HW, to be recovered with big SW sales, wouldn't be appealing for them. Anyhow, as I wrote just after, thanks to not very honest Euro conversion, EU retailers manage to get a much higher margin on HW too, so here PS3 could be appealing by itself, while where the margin is 5-10%, retailers MUST sell SW too to have an overall good margin.

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