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Forums - Sales Discussion - Sony may have a profitability problem from falling PS3 software sales.

PS3 software sales Q4 2009 up til todays date end of 26th Sept to 19th Dec: 39,765,298

PS3 hardware end point: 30,097,783

PS3 software sales Q4 2008 up til 20th Dec 2008 from 27th Sept 2008: 31,690,383

PS3 hardware end point: 18,168,026

PS3 hardware difference: 65.66% increase

PS3 software difference: 25.48% Increase

Peak software comes just after a peak in hardware sales. So overall Playstation 3 software sales will likely peak sometime in 2010 and fall year over year just before the holiday season with overall revenue dropping as Playstation 2, PSP and Playstation 3 hardware sales will all likely drop again year over year as well as the overall software sales for their Playstation family of products as the PSP and PS2 reach the terminal end of their lifecycles. The problem this introduces for Sony is that if SCE loses money for this quarter it will be extremely difficult for them to recoup any losses made on the PS3 slim.

To reach profitability they cannot simply cut the price again as it will unlikely give them the right mix of software and hardware revenue and a price cut may simply delay the overall decline in software revenue by another year. Their best bet is their Gem wand for both increasing hardware revenue and overall software sales for the year in 2010 which will be similar to how Nintendo has kept their overall software sales high this holiday season because of the overall selling power of their Wii Sports Resort software. If they cannot break through with Gem then they would lose all chance of making more than a few mildly profitable quarters which at best means clawing back about a little more than billion dollars worth of losses.

Edit because of Rols request:

Xbox 360 software sales Q4 2009 up til todays date end of 26th Sept to 19th Dec: 47,300,962

360 hardware end point: 35,795,505

360 software sales Q4 2008 up til 20th Dec 2008 from 27th Sept 2008: 48,978,109

360 hardware end point: 25,723,992

360 hardware difference: 39.14% Increase

360 software difference: 3.5% decrease

So essentially the Xbox 360 software differences show that when the hardware rate increase falls to ~33% year over year the sales increase of software stagnates without some extra input.

Wii software sales Q4 2009 up til todays date end of 26th Sept to 19th Dec: 70,406,200

Wii hardware end point: 62,585,048

Wii software sales Q4 2008 up til 20th Dec 2008 from 27th Sept 2008: 66,758,799

Wii hardware end point: 42,016,681

Wii hardware difference: 49% increase

Wii software difference: 5.5%

So what Wii software shows is that you need roughly an increase in hardware of 50% to show an increase of 5% in software sales for this platform at this point in its lifecycle.

If we assume the Playstation 3 follows this model then Sony will need to sell about 15 million consoles for the calendar year to show a similar year over year increase that the Wii platform showed during the q4 holiday season.

i think my point still stands.

 



Tease.

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The collapsing sales from PS2 and PSP will hurt more



Currently playing on PS3: God of War III

Currently playing on Xbox360: Final Fantasy XIII

Currently playing on NDS: Chrono Trigger

Squillium why is it that EVERY SINGLE thread you have made related to the ps3, has been both sacasticly negative towards it, or just plain I hate ps3 towards it

Can't you make one positive thread regarding the word SONY and the acronymn PS in it?



 

mM

So does this mean Sony is doomed in 2010?



Gaming make me feel GOOD!

In other word, success today is their doom tomorrow.



 Next Gen 

11/20/09 04:25 makingmusic476 Warning Other (Your avatar is borderline NSFW. Please keep it for as long as possible.)
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dolemit3 said:
The collapsing sales from PS2 and PSP will hurt more

             ^ this



You seem to be forgetting that newer users aren't going to be picking up loads of games the same quarter they pick up their hardware. They will get 2-3 games (or less) with their consoles, then generally be happy enough with said hardware. Look for the software increases related to these hardware sales to happen in Q1/Q2 next year onwards (likely late Q1 at the earliest).



leo-j said:
Squillium why is it that EVERY SINGLE thread you have made related to the ps3, has been both sacasticly negative towards it, or just plain I hate ps3 towards it

Can't you make one positive thread regarding the word SONY and the acronymn PS in it?

Just how are sales facts hateful or sarcastic?

 

He could be right, we do know that The PS3 was selling for a loss not too long ago and might very well still be selling like so. With that, it's pure math that when you have a bigger generator of loss than profit, so hw rise > sw rise you might end up with worse financial results. Simple.

And if you don't like threads like these, don't enter them.



If i lose access to this profile as well....I'm done with this site.....You've been warned!!.....whoever you are...

Happy Wii60 user. Me and my family are a perfect example of where hardcore meets casual and together mutate into something awesome.

double post



If i lose access to this profile as well....I'm done with this site.....You've been warned!!.....whoever you are...

Happy Wii60 user. Me and my family are a perfect example of where hardcore meets casual and together mutate into something awesome.

What is your deal lately man? its like your on an Anti-Sony Crusade lately.