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Sony PlayStation (Games)

Sony, Analysts React To PS3 Launch 247

Posted by Zonk
from the settling-down dept.
cdneng2 writes "Sony may be aware that something is just not right. There's a reshuffling of management occurring within Sony. Kazuo Hirai is set to head their videogame unit, as Ken Kutaragi has been bumped to the Sony board. Jack Tretton, former COO for SCEA, is now the president and CEO of that arm of the company. There's no word on the reasoning behind these position shifts. On the same day, Namco announced that they must sell 500,000 games to begin making profit on PS3 games. A Financial Times article confirms speculation on how hard it will be for Sony to make money, as analysts with UBS predict that 30 games must be sold per PS3 for them to break even." To add insult to injury, EA CEO Larry Probst has said PS3 numbers were lower than expected. Current thinking is that Sony managed to ship roughly half of the 400,000 units they were promising.
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Sony, Analysts React To PS3 Launch

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  • Alas... (Score:4, Funny)

    by zarthrag (650912) on Thursday November 30, 2006 @04:42PM (#17055314)
    ...and here I am, still unable to buy a nunchuk (not from an ebay scalper) Yes, I am nintendo's b****/fanboy
    • You're complaining about nunchuks? I am still unable to buy a Wii itself.
    • by seebs (15766)
      I got really lucky; a local Walmart had two left over after they sold out their Wii systems stock. I'm still one short.
  • by moore.dustin (942289) on Thursday November 30, 2006 @04:48PM (#17055448) Homepage
    What are all these posts about how well/bad the PS3 is doing on here? First, we have discussed and read about it twice a day for a week now and second, it is all total BS. We can not and should not be saying anything yet because we dont know anything. It will take months, at the earlier to be able to gage what all three systems are doing in comparison to each other. The 360 is the only system that should have stories like this. This time next year I am all about reading how the PS3 really did bomb and how the Wii sold 60 million units. Right now though, it is retarded.. why? Everything is sold out everywhere the second it gets there. Let the market saturate, supply and demand to even out, give a year of manufacturering costs and shipments numbers to adjust, then we can talk okay?
    • by Rachel Lucid (964267) on Thursday November 30, 2006 @05:02PM (#17055728) Homepage Journal
      It's simple logic: the console that 'wins' will have the most games made to work on it (and I don't mean just backwards-compatible). People don't want a loser, since it'll mean they have decidedly fewer games for later on.

      Because this generation requires such a huge investment, people want a decision to be made in the console war quickly enough that they can avoid buying a 'losing' console and wasting their money.

      If you can find a way to solve this, let us know.
      • by brkello (642429)
        Uh, it's simple. Do what the guy said. Wait a year after the console is out and then make a decision. I really think consumers all must be raving morons running out and buying these consoles when they have the most bugs and are at their most expensive.
        • by Daetrin (576516)
          Uh, it's simple. Do what the guy said. Wait a year after the console is out and then make a decision.

          As an individual solution that's great. But note that if _everyone_ took that route then _every_ new console would fail.

      • by ivan256 (17499)
        Your logic is backwards. It's the console with the most games made for it that wins.

        The console wars are wars to win developers, not to win customers. That's why the vendors are willing to sell the units at a loss at first. If you have developers the customers will come. If you don't want to make a huge investment in the 'loser', wait until the games you want are out, and buy the console they run on. Otherwise, you risk making the wrong choice. That's the solution.

        Sony doesn't care that they won't make a pr
    • by interiot (50685) on Thursday November 30, 2006 @05:13PM (#17055956) Homepage
      200,000 units worldwide is not a "launch". Almost nobody is talking about the PS3 online because almost nobody has one. 3DO sold 6 million units and is considered a miserable failure. It's taken how many months of manufacturing for Sony to produce 200,000 units... How long do we have to wait for Sony to manufacture 6 million units? 2.5 years?
      • by brkello (642429)
        Can you people read? That is what he is saying. We have no idea how much they can produce. We will have a better idea after a few months and a really solid one after a year.
      • Re: (Score:2, Interesting)

        by amuro98 (461673)
        Sony's launch wasn't very good, but at least give them the credit they're due... They released an estimated 83,000 units in Japan, and 200,000 more in the US.

        Never mind the fact that the 360 outsold the PS3 in Japan in the month of November, and during that same period, roughly 3x as many 360s were sold in the US.

        Considering that the PS3 has been in production (according to Sony) since October, they didn't even manage to ship 300k PS3s during the month of November? Yet Sony is still confident they'll hit
    • by PygmySurfer (442860) on Thursday November 30, 2006 @05:33PM (#17056366)
      Why? The PS3's performance effect's Sony's bottom line NOW. We know plenty, like the significant loss Sony is taking on each console sold, the exceptionally low number of units available, and the increasing number of former exclusives dumping Sony and going multi-platform. The linked stories include facts such as Sony having to sell 30 titles per console to make a profit, versus 8 for the PS2, Namco has to sell 500,000 units to break even, etc. There are also educated guesses (not just fanboy guesses but educated guesses by top people at EA, who would know this sort of thing) that Sony has shipped about half of the units they claimed they were going to ship (which was already cut drastically prior to launch). We also have other launches to look at, like the 360 (not so great), Wii (pretty good), and the PS2 (pretty good). Microsoft sold 900,000 units in North America by the end of 2005, another 500,000 in Europe (Can't find much for 2005 in Japan - 62,000 units in the first 3 days, and 103,000 units by April of '06). Sony probably won't even sell as many Worldwide (well, Japan and North America, since they cut out Europe) by the end of '06 as MS did in North America alone in '05.

      Nintendo sold 600,000 Wii's in North America in the first eight days of it's launch, and they're aiming for 4 million worldwide by the end of '06. Obviously, it's been a success for Nintendo. Since they've been on the market for the same amount of time, can we not claim the PS3 launch hasn't been that great, and that Sony is hurting?
    • Apparently the "experimental threading" stuff includes javascript moderation too, but it bugged out and put in a mod that I didn't want. So here's my unmoderate ;)
    • by Guppy06 (410832)
      The thing is, these consoles are put out by corporations and they have to cater to investors as well as customers. And those investors want to know whether the product being put out is good enough to justify an investment. The "wait for the dust to settle" approach will satisfy neither the investors, who want as much meaningful information as possible before deciding to take the plunge, nor the corporation itself, which needs to entice those investors in order to stay afloat. This is why we're getting th
    • by Kris_J (10111) *
      I may take months to know anything, but lots of serious decisions in the industry will be made within weeks. When a game publisher needs to sell 2.5 copies per PS3 actually sold just to break even, they have to seriously consider jumping to another platform. Consumers might be able to just wait and see, but companies don't have that luxury.
    • You're right in that this is both irrelevant and misleading to consumers due to limited data, but a financial analyst looks at numbers like these and starts selling stock. Prices drop, investors lose confidence, development houses no longer create exclusives, and consumers won't want to drop $800 (system, tax, controller, games, cables, etc) for it.

      You can't get around the cold hard financial reality of what they are doing. Xbox was the first system to take a significant loss on consoles, ($35 dollar los

  • 30 Games (Score:4, Interesting)

    by MadUndergrad (950779) on Thursday November 30, 2006 @04:51PM (#17055504)
    30 games per PS3 is really a lot. Not being much of a console gamer myself, I don't know what the average games-per-console is, but that seems pretty high. Of course this figure depends on how much Sony can bring the cost of manufacturing down. Did the analysts assume that they would and factor it in, or did they assume a constant cost/console?
    • Re:30 Games (Score:4, Insightful)

      by HappySqurriel (1010623) on Thursday November 30, 2006 @05:06PM (#17055816)
      30 games per PS3 is really a lot. Not being much of a console gamer myself, I don't know what the average games-per-console is, but that seems pretty high. Of course this figure depends on how much Sony can bring the cost of manufacturing down. Did the analysts assume that they would and factor it in, or did they assume a constant cost/console?

      Here is a link to a cost analysis of the PS3 ( http://www.isuppli.com/news/default.asp?id=6919 [isuppli.com] )

      The question I would have is whether Sony can bring the cost of manufacturing down at a rate greater than the rate they're going to be forced to reduce the price of the system?

      Sometime in 2007 Microsoft will reduce the price of the XBox 360 so that the XBox 360 Bundle is $299 (as a guess), at this point in time Sony will be left with the decision to reduce the price of the PS3 or to reduce their loss on the PS3. If Sony allows Microsoft to Bully them into reducing the price of the PS3 it is likely that Sony will not start turning a profit on hardware throughout the entire generation (similar to what happened with the XBox), on the other hand if Sony doesn't reduce the price of the system they will likely bleed marketshare to Microsoft.

      Honestly I hate Microsoft but the more I think about it the more I believe that Sony has lobbed the ball right into Microsofts court and ran off to get a drink while the ball is still in play; if Microsoft converts on this it will be really ugly for Sony.
      • Re: (Score:3, Interesting)

        by C0rinthian (770164)
        Sony dumped a LOT of money into the PS3, and isn't going to make it back anytime soon. This much is obvious. If MS decides to push the release cycle again on the next generation, (and gets away with it) they could put a lot of pressure on Sony.

        It wouldn't be the first time MS used this tactic to knock a competitor out...
        • Re: (Score:3, Insightful)

          by Shados (741919)
          Indeed. And i have a feeling Nintendo is calling that move, thus the "cheap, low R&D investment, easy to produce" Wii idea. 10$ Nintendo is -praying- for Microsoft to pull off that move.
        • by jonabbey (2498) *
          Right, and those are sunk costs, no matter what. It's irrelevant how long it would take Sony to pay back their development costs, really. If Sony doesn't do what is necessary to get their price as competitive as possible, that's Sony's problem. Keeping the price high to try and earn back their investment on the hardware would be folly if it results in no one buying the machines.
          • the point is that Sony may not be able to front the funds for the next gen console as fast as Microsoft can. IF MS pushes faster than they can match, they could be knocked out of the market.
    • Re: (Score:2, Interesting)

      by Andy_R (114137)
      I call FUD. 30 is a random number an analyst pulled out of his ass, and should be treated as such, especially as we don't know who paid the analyst to say that.

      Nobody knows how many units Sony will make before they kill off the PS3, nobody knows the component price cuts that will happen before then, nobody knows the unit price drops they will make, and only Sony know the margins, the R&D cost and the deals they have with all games manufacturers. Factor in cross-subsidising of the profit or loss on sales
      • Re:30 Games (Score:5, Funny)

        by thatguywhoiam (524290) on Thursday November 30, 2006 @05:31PM (#17056314)
        Nobody knows how many units Sony will make before they kill off the PS3, nobody knows the component price cuts that will happen before then, nobody knows the unit price drops they will make, and only Sony know the margins, the R&D cost and the deals they have with all games manufacturers. Factor in cross-subsidising of the profit or loss on sales and develpment of Cell and Blu-Ray plus blue-ray movie sales, random numbers for advertising budgets, devkit profits or losses, online service profits or losses and currency fluctuation profits or losses, and you end up with a pretty indefinable number to divide by the analyst's guess at an average profit per game.

        Master,

        Your Flying Wheel Of Reasonable Discourse Technique... is Astonishing.

        Hai!

      • Re:30 Games (Score:4, Interesting)

        by heli0 (659560) on Thursday November 30, 2006 @08:37PM (#17059114)
        "random number an analyst pulled out of his ass"

        How can this be modded to +5 when the exact methodology used is described in the article?
        You may not agree with their assumptions, but it is certainly not "random".

    • 30 games per PS3 is really a lot.

      Whether this figure is right or not doesn't really matter, when you consider that Sony still needs to sell a lot more games than Nintendo to make profit. For those not in the know, Nintendo makes money on every console sold, and they have also stated before that there are a good number of people who will buy a console for just one game.
  • by Johnny_Law (701208) on Thursday November 30, 2006 @04:52PM (#17055514)
    A Financial Times article confirms speculation on how hard it will be for Sony to make money, as analysts with UBS predict that 30 games must be sold per PS3 for them to break even."

    As much as I would like to poke fun at Sony for this seemingly high mark, they can also make a profit by selling a combination of PS3 games and Blu-Ray movies. It is much more reasonable for someone to have lots of movies than lots of games. Assuming of course the purchase is made at a retail store so Sony gets the profit, rather than a used dealer.
    • by GreyyGuy (91753)
      True- except that blu-ray movies cost far more then the same DVDs and most objective sources seem to be saying there is no reason to move to either blu-ray or HD-DVD since most people can't see any difference. I don't know anyone who has a blu-ray player or has plans to get one, so I can't imagine that blu-ray is going to make Sony lots of money in the near future.
      • by Babbster (107076)
        The "make money on Blu-ray" theory also fails in that Sony makes less money per BD movie than it does per PS3 game. As a special added bonus, Sony doesn't get to take home the entire per-disc licensing. Instead, they get to share those fees with the other 8 "Blu-ray Disc Founder Companies" such as Matsushita (Panasonic), Sharp, Samsung and Pioneer.
    • by ObligatoryUserName (126027) on Thursday November 30, 2006 @05:39PM (#17056482) Journal
      they can also make a profit by selling a combination of PS3 games and Blu-Ray movies.

      They said the same thing about the PSP and UMD. Lets hope for Sony's sake it works out better this time!
  • PROMOTED??? (Score:5, Insightful)

    by KDR_11k (778916) on Thursday November 30, 2006 @05:02PM (#17055726)
    Ken "nutjob" Kutaragi gets promoted? WTF is wrong with them? This guy is a walking PR desaster spewing comments like "we have created the most beautiful thing in the world" in response to the misaligned PSP button sensor issue or "people will want to get a second job to afford a PS3". Their situation is bad enough without rubbing it into people's faces with arrogant comments that show he doesn't even feel bad for screwing up like that.
    • by calbanese (169547)
      He was kicked upstairs, offered a window seat - whatever euphamism you like. Its a promotion in name only. He no longer controls the day-to-day operations of Sony's games unit. Its a loss of prestige and power.

      Japanese executives are rarely fired for their mistakes as (I am told) the shame of it has led to hari-kari. (I am sure someone with more knowledge of Japanese corporate culture than I could affirm or deny that). So the result is a promotion to a position where you can't do any more damage.
      • Re: (Score:3, Interesting)

        by Maul (83993)
        This is true from what I've come to understand.

        Japanese executives with high visibility are generally not fired, but rather are basically forced into a psuedo-retirement where they sit on an ineffectual board or something similar. From the outside it may look like a promotion, but (as you said) in reality he's been moved to a spot where he won't be doing very much as far as actual job duties.
        • Lucky bastard.

          "Here's your corner office, secretary, and 6 figure salary. Just try not to break anything."
          • It's really more like:

            Here's your six-figure salary, your secretary, and a telephone. Henceforth, you are to report at 8am, and remain at your desk until 5, with a one-hour break for lunch, and answer that phone whenever it rings. You should notice that the telephone is not plugged in, and that all the passers-by on the street can see you sitting here with an empty desk staring at a phone that they, too, know will never ring. Oh, and your secretary will be keeping track of your hours, so don't think about

      • Re: (Score:2, Informative)

        Hara kiri, actually, is the transliteration, though in Japan you'd say seppuku.
    • Re: (Score:2, Interesting)

      by CheechWizz (886957)
      I've heard about a Japanese businesses promoting failing managers, the theory is that more responsibility will lead to better performance by said manager.

      But I don't think that's the case here, not that I'm a big Sony fan but the guy did start the whole playstation project which undeniably took the video game industry to a new level (which has it's good and bad sides offcourse), so he's not a complete idiot. In the end he did make Sony ALOT of money and at the beginning of Sony's gaming division there wer
    • by Xest (935314) *
      Unfortunately this is how the corporate world all too often works.

      It's hard to just sack people else you risk all sorts of industrial tribunals, unfair dismissal cases and so forth, what's more management jobs really are often quite easy, as an example I've seen first hand we had a guy once who made us £1.5million a year in sales when a management position came up it went to the guy who only made £300,000 a year because the management job really wasn't too tough and why take away someone making
  • by Phoenix666 (184391) on Thursday November 30, 2006 @05:08PM (#17055842)
    Good lord, just how many new games do they think the average gamer buys? At $50 a pop that's $1500. I have that much disposable income, but I'd certainly not blow it on paying top dollar for games. I'm sure I don't have more than 20 games total for my PS2, and all but 2 of those I fished out of the bargain bin.

    I am so happy I own no Sony stock, and even more optimistic about having bought Nintendo stock.
    • by trdrstv (986999)
      Good lord, just how many new games do they think the average gamer buys? At $50 a pop that's $1500.

      Yup. Also the PS3 games are $60 each so that would be $1800.

  • by turnipsatemybaby (648996) on Thursday November 30, 2006 @05:16PM (#17056016)
    Given the amount of truely idiotic and genuinely hostile things Sony has done to consumers, they deserve nothing more than utter failure.

    Sadly, way too many people have short memories and don't care that computers were scrambled by willfully malicious sony music CDs.

    Or the fact that they love to sue music cust^H^H^H^Hpirates into submission. "Don't even have a computer? Give us money anyway cause we KNOW you've been pirating!"

    Hell, the last sony laptop I got my hands on, had so much advertising crap on it that it actually *slowed down* the machine significantly, until I uninstalled all of it.

    I'm sure I'm forgetting plenty of examples of Sony's heinous, arrogant behaviour.
  • by thatguywhoiam (524290) on Thursday November 30, 2006 @05:27PM (#17056240)
    I don't understand this statement at all:

    Graphics for the high-definition games cost about 1 billion yen ($8.6 million) to create, more than double that for Nintendo Co.'s Wii titles, Takasu said in a Tokyo interview Nov. 28.

    What does this even mean? We have a blu-ray disc that holds lots of data, sure, and accordingly scaled up textures; but in any sort of process like this you are continually downscaling from practically any 'artistic' original source to begin with. Why does this cost more to downscale less than you were originally? Is it just harddrive space? That seems historically low.

    And this doesn't even seem to take into account the idea that some games have different budgets? Why can he not make a game for both the Wii and PS3 that uses basic motion sensing? I think its a good idea if multiplatform games look as uniform as possible, and after all, "its not about the graphics anymore", right? Seriously, I'm asking, if any one can credibly enlighten me as to why Namco would say this? (I am a graphic designer by trade but I do not work in the game sector.)

    • by NeutronCowboy (896098) on Thursday November 30, 2006 @05:50PM (#17056692)
      Here's the problem with high-resolution graphics and lots of polygon-pushing: someone has to create the art for it. In Mario's times, you only needed to be able to approximate a plumber using about 200 pixels and 256 colors. Quite frankly, I can do that. In about 1 hour. For $5. Well, okay - I probably would have to get an artistically inclined friend to do it who knows how to handle Paintshop. But the point is that I don't have to worry about shading, proportionality, or anything like that. Compare that with today's creatures: they need to look good while at a resolution of 1920*1080, have proper normal maps, be based on great-looking models made by quality artists (no sucky part-time artist will be able to make stuff that looks good with these requirements). Not only that, but you need lots of art. Far more than for other games that didn't have that space or that processing power. Let's see - 6 million dollars, assuming 50K per artist, that comes to about 50 artists working for 2 years on a game. Sounds about right these days, especially when you're talking big-budget game.

      Can you make low-budget games? Sure can. But expect to get ripped on sucky graphics, just like the Wii Sports series did.
       
      • Re: (Score:3, Interesting)

        by westlake (615356)
        In Mario's times, you only needed to be able to approximate a plumber using about 200 pixels and 256 colors. I can do that. In about 1 hour. For $5.

        No you can't.

        Character animation -- the illusion of life -- personality --- distinctive movement --- is what separates the men from the boys.

        Low resolution makes the problem all the more difficult.

        • True. Animation separates the men from the boys, and is fiendishly hard to get right. However, if mario's animation is complex, the animation in Splinter Cell: Double Agent is miles beyond that. Again, the problem is the same: approximating something using 5 frames is a lot easier than when you have to make it believable from multiple angles at 60 fps.
        • by Knara (9377)

          Um... in 200 pixels there's none of that.

          "What's that?"

          "That's you."

          "What am I?"

          "A flying ostrich"

          "Orly?"

          I mean, comeon, Castlevania I motion is "lifelike"? I guess... if you squint.

          And are drunk...

    • Try to take a piece of artwork (a picture of a person) and turn it into a sprite, perhaps 80*80. That took about 10 seconds.

      Now try to turn that same picture into a 3D model with a billion (exaggerated, but getting close) polygons. Unfortunately they are actually adding information to a 2D drawing to make it 3D, detailing thickness and reflection and such. Now add in animations. For the 2D sprite you make a second sprite and switch back and forth between two. For the 3D model...

      Tell me right now that y
      • by Carnildo (712617)
        Nobody is going to go back to sprite graphics


        I wish they would. The later SNES games had some of the best graphics I've seen.
  • by sycomonkey (666153) on Thursday November 30, 2006 @05:53PM (#17056744) Homepage
    Damn. I would consider myself a rather big fan of the Gamecube, it is the console I own the most games for, and I own far less than 30. It's more like 18 or so. I only have 6 or 8 PS2 games. I don't know how Sony is going to pull themselves out of this mess, but they better think fast...
    • by Shados (741919)
      They're most likely gambling a lot more on Blu Ray working out thanks to the PS3 than on the actual game sales, thats why.
  • by ciw42 (820892) on Thursday November 30, 2006 @06:38PM (#17057508)
    Think I'm just going to wait until someone can decide what the criteria are for judging who wins a contest like this before I try and make my predictions. Some thoughts...

    Microsoft have had a full year selling the Xbox 360, which overall has undeniably been very succesful. It's online service is highly regarded, and we're now starting to get games which are pushing the console. In all those respects, it's a winner. However, they're still losing money on each unit sold, and they're backing one of two Hi-Def standards, and it may be the loser, but at least they've made it optional, so if it fails it's not going to taint the machine as a games console. If I was a serious gamer, I'd already have an Xbox 360. People know exactly what it can do, and whether they want one or not. Very few people will buy an Xbox 360 and be disappointed, it's already relatively mature and lack of novel user interfaces aside, the others are going to be playing catch-up for the next two years.

    No matter what anyone says, Sony have made a phenominal number of mistakes with the PS3. However, many simply boil down to marketing goofs, and a "they'll want what we tell them" attitude which has certainly made them no friends. They're using the console to push other technologies of their own, and that is by far their biggest risk, and also the thing that's likely to keep the component price of the console high for longer. All that said, once the less than stellar launch is forgotten (that'll be around January), there's stock on the shelves, and we start seeing well written games which make use of the phenominally powerful hardware (probably in around a years time), and after whichever price drop brings the high-end console down to around half of its launch price, I'll probably get one. However, I suspect there'll be many people who are disappointed with what the machine achieves within its first 12 months of public life. It's the sort of console that if you owned one you'd want to show it off and shout about. It's a nice looking piece of consumer electronics and there are going to be some impressive looking games, but it's very much like the flash cars you see at shows (you know? The ones that cost more than your house) that you want to just stare at. You'd try and encourage a friend to buy one, so you could go for a spin in it every now and again, but you'd never consider buying it yourself, even if you could afford it.

    I'll openly admit however, that my personal enthusiasm is for Nintendo's Wii. But then I'm not a hardcore gamer, and what excites me may well not excite the next man in line. I think the technology is easily good enough to give me games which are visually stunning, that sound good, are innovative (which is something I've come to appreciate more as I get older) and are fun to play. When I get around to buying a Wii in the New Year, I think it's also very likely I'll start getting Virtual Console games on a regular basis, as I'm of an age that I remember them the first time around, and there are a good handful of full games which I'll be looking to pick up when they launch. Nintendo have a good business plan, which all but ignores the other two players. It's practical, manageable, and it also means that they make money every step of the way, instead of losing a lot now, and trying to claw it back over time. The Wii does not set itself against the competition, simply alongside. It doesn't promise the earth, and then struggle to deliver, because all along Nintendo have played down what the machine is capable of and re-itterated that it's all about the games. Until the DS showed how effective that strategy can be, I doubt anyone believed them.

    What it should really boil down to is which consoles are of interest to us personally, and that will ultimately depend on which game genres and series appeal to us, and how strongly they are represented on each platform. Let's not forget that the PC is now a very strong gaming platform, much more so than when the last generation of consoles launched, and that will divert some
    • Unless you've bought shares in one of these three companies

      Actually I did, and Nintendo has spiked since their E3 showing.

      Nintendo have a good business plan, which all but ignores the other two players. It's practical, manageable, and it also means that they make money every step of the way...

      Which as an investor I REALLY appreciate. However what sold me on the system was talking with my parents. (both ~60, and as Non-gamer as you can get). Both love WiiSports and after playing it over thanksgivin

  • A Deep Hole (Score:2, Interesting)

    Okay, how many fewer games are being bought because of the low supply/high demand/eBay mark-up trend? The money to purchase games for the console has to come from somewhere, and I'd suspect it is all going towards just getting a PS3 console into a home.

    Should Sony go after eBay resellers for damages? Could they?
  • The whole notion that they are selling the machines at a massive loss pussles me. The analysts use retail or whole sale values for their estimated prices but Sony produces almost all the parts in house. Wholesale is still 40-100% over the cost of manufacturing and retail is often 200-500% over basic costs. Sony has never said they are selling it at a loss and they have traditionally never done so. The only console confirmed to sell at a loss is the Xbox. All other consoles were either profit or break even p
    • by seebs (15766)
      Where do you get the idea that they're NOT selling at a loss? Analyst estimates of the cost of making the PS2 were always substantially higher than retail value; I've seen estimates of $300 THIS year.

      Sony gets substantially less than the retail price, too.

      I have no reason to believe that Sony has ever made money selling a console; it's always been game licensing.

      When people say that only the Xbox has been a loss, they mean the WHOLE BUSINESS is a loss -- Microsoft lost money even taking licensing into acco
      • Re: (Score:3, Insightful)

        by king-manic (409855)
        Where do you get the idea that they're NOT selling at a loss? Analyst estimates of the cost of making the PS2 were always substantially higher than retail value; I've seen estimates of $300 THIS year.

        Sony gets substantially less than the retail price, too.

        I have no reason to believe that Sony has ever made money selling a console; it's always been game licensing.

        When people say that only the Xbox has been a loss, they mean the WHOLE BUSINESS is a loss -- Microsoft lost money even taking licensing into accou

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