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Sony PlayStation (Games) The Almighty Buck

Sony's Harrison In No Rush to Lower PS3 Price 107

njkid1 passed on a link to a GameDaily interview they conducted at DICE with Phil Harrison, SCE WorldWide Studios President. Harrison stays mostly positive throughout the article, pointing out that the availability of consoles is a sign of a healthy supply chain. He denigrates rumble in controllers as a 'last generation' feature, and specifically discusses the company's decision-making process for lowering prices: "The PS3 technology, as with any of our platforms, starts off life at a high price and then we engineer cost out of it. And that process is an investment that you make to combine chips into a single chip or to reduce components or combine components and redesign things, and that investment is part of our planned R&D effort to reduce cost. At the appropriate time and when we can afford to, the business model of the industry is to pass those savings onto the consumer, but we're a long way away from doing that yet."
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Sony's Harrison In No Rush to Lower PS3 Price

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  • Of course (Score:5, Interesting)

    by tbannist ( 230135 ) on Tuesday February 27, 2007 @02:54PM (#18169876)
    Really, there's no point in dropping the price right now. Until Sony gets a couple of killer games out, dropping the price isn't going to really excite anyone.
  • Insulting (Score:5, Interesting)

    by vapspwi ( 634069 ) on Tuesday February 27, 2007 @03:24PM (#18170368)
    As a fan of the PS2 who WANTS the PS3 to succeed (I'll buy one when the price comes down...), I find this interview rather insulting. It's just so transparent that EVERYTHING he's saying is just a repeat of the company line, trying to turn negatives into positives.

    Lots of PS3s languishing on shelves? "We do a good job managing our supply chain." Target in Newnan, GA, 4 PM on 2/25: 11 PS3s, 0 Wiis. Congrats on your expert supply chain management, Sony, but maybe you'd better focus on SELLING THE PRODUCT.

    No rumble in the controllers? "That's a previous-gen feature." Yeah, and why would you carry over a minor feature that most users are neutral or positive about into the next generation...

    Motion sensitivity? "Far more opportunity for future innovation..." Ah, so that's why Sony didn't even HAVE motion sensitivity in place until the last minute, then?

    Arrgh. Just infuriating.

  • Re:Of course (Score:2, Interesting)

    by WidescreenFreak ( 830043 ) on Tuesday February 27, 2007 @03:27PM (#18170412) Homepage Journal
    I disagree. I think that the BluRay functionality would be a major reason to purchase one, especially if the price dropped. However, that's exactly why a price drop is not going to happen. It has nothing to do with the PS3 but with the positioning of other products.

    In particular, Sony just announced a set-top BluRay player for - look at that - $599, which is the MSRP of one of their PS3 models, I believe. I would not be surprised that the reason for the price drop of the player is to match the PS3 price. "Hey, wait. People are buying our PS3s to be BluRay players, so our regular BluRay players are just sitting on the shelf." Now people have a choice for roughly the same price: a PS3 without the full functionality of a standalone BluRay player -or- a full player with all of the features that a PS3 doesn't have but it cannot play PS3/2/1 games. If they dropped the price of the PS3, that would undercut their position on their new, lower cost BluRay player.

    It seems more to me that they're trying to avoid making the PS3 the BluRay player of choice because of having a lower cost that an fully featured player, which is exactly what would happen if they dropped the price.

    Just my two cents. I still don't want a PS3.
  • by Kohath ( 38547 ) on Tuesday February 27, 2007 @03:28PM (#18170450)
    I'm not on a team. The press should think about reporting the news instead of beating up on Nintendo or Sony or anyone else. Sony saying the price isn't going to change isn't news.

    The whole "Can you believe the Sony execs don't agree with us about our latest obsession?" storyline that the press has going is silly.

    In other news, The Sun says it has no plans to change it's habit of coming up in the morning. We'll be back with updates on that story every 20 minutes or as they occur.
  • Re:yep (Score:1, Interesting)

    by Anonymous Coward on Tuesday February 27, 2007 @03:30PM (#18170488)
    Just me wondering, How long was it until PS2 could be found routinely in stores?

    I ask this because I suspect it was more than three months, but I could be wrong. And before you label me a "sony-hater" remember that I am comparing two Sony products (even though I am conviently ignoring games, but I wasn't really interested in any PS2 launch games either).

    As for price lowering, I'd bet Apple would have more of a market if the Mac was $2000 rather than $2495 in 1984. (I recall a story that DOS sold more than OS rivals because of a lower price, but I could be mistaken) Remember that network effects apply to video games as well.
  • Re:yep (Score:5, Interesting)

    by Cadallin ( 863437 ) on Tuesday February 27, 2007 @03:40PM (#18170680)
    Um no, They aren't selling out, and we're not talking a console or two. We're talking even the smallest retailers have a a stack of half a dozen machines, with the big stores having stacks of the things. This isn't just the states either, its the same in Japan. Retailers in Japan have already started to discount the machines just to get rid of them. This isn't bad, its an out and out disaster. And Sony's not helping things either. Telling Europe they're getting crippled systems with impaired backwards compatibility isn't exactly drumming up excitement for the European launch (and its not really pleasing anybody else worldwide either).

    If Sony wants to salvage the situation, they need to be doing something right now. Because here's what Sony's got: The worst development tools (vs. Xbox 360, great dev tools, and the Wii, with good tools, and lots of experienced developers in the field), the most expensive platform to develop for (partially due to poor tools, but also due to the use of expensive technologies like blu-ray), the smallest market share, and the slowest growing market share. If I were a developer, I'd be thinking long and hard about my commitment to the PS3 right now. The alternatives are looking very tempting. At this point I wouldn't even count on Final Fantasy remaining Sony exclusive. My guess is that Microsoft is probably flashing crap tons of "partnership" cash in their direction(It's what I would do if I were a Microsoft Gaming Division executive), while Nintendo is content to let their profitability and growth speak for themselves.

  • by Wilson_6500 ( 896824 ) on Tuesday February 27, 2007 @03:51PM (#18170856)
    What, like gameplay?

    Seriously, what kind of rationale is that for leaving out a feature? If that's a _justified_ reason, then it means that the feature was all along just a gimmick to lure people in, like virtual reality (i.e. red lines) or force feedback or onboard memory expansion. Why would you want to say something like that to people? "Well, we can't dupe you dolts any longer with that candy, so we'll drop that for some new one like motion sensing." If it's _unjustified_ to dismiss it as last-gen, then you're dropping support for something that gamers might possibly want or like; if gamers don't like it or don't care about it, why not just say that? It's not like Sony would be admitting that they made a mistake since they didn't exactly pioneer the idea of controllers with rumble.

    It's not really even right semantically. It's not like we have something better to replace it--you could argue that motion sensing and rumble aren't compatible and one would have to replace the other, but since they don't do the same thing it's not really a supersession of "last-gen" rumble with "next-gen" motion sensing. If we found some whiz-bang thing that would make for instance anisotropic filtering obsolete, THEN you could call anisotropic filtering a "last-generation" feature.

    In this context, it just sounds like marketingspeak use of "generation."
  • Money Better Spent? (Score:3, Interesting)

    by Plekto ( 1018050 ) on Tuesday February 27, 2007 @04:37PM (#18171686)
    I as talking with a friend online last night and the PS3 came up. It eventually came around to the price and two things came up.

    1:$600 in PC upgrades results in an astounding increase in gaming potential for most people. Far more than any PS3. Why should we spend $600 for a box that's merely comparable to the old gaming rig we want to upgrade anyways?

    2:If Sony ditched the Blu-Ray player or made it an optiona add-on, the PS3 would barely cost $250, if that. $300 is a hard price-point, like $30,000 is for car buyers. It's hard to justify more than that much for somethng unless there's a real need for it.(let alone $600 or a $60,000 car). The Wii sells well because it's inexpensive and fun. The PS3 is expensive and games are slow to arrive.

    3: One more - Me? I bought a PS2 this holliday season for my son. Cheap, effective, and it has Guitar Hero and GT4 and so on. Its a great toy for him and didn't break the bank.
  • Re:yep (Score:3, Interesting)

    by fistfullast33l ( 819270 ) on Tuesday February 27, 2007 @04:49PM (#18171906) Homepage Journal
    We're talking even the smallest retailers have a a stack of half a dozen machines, with the big stores having stacks of the things.

    You're right, I was just in Best Buy and Circuit City last night, and thanks to Sony's console I now have two pending lawsuits due to negligence from stumbling over the damn boxes! They're piled up outside and the retailers can't even give them away!

    Let's cut the hyperbole for a second. If the crisis was as bad as you say it is, two things would be happening.

    1) Retailers would be screaming for a price cut or motivational factor to move the consoles. They don't want them sitting on the floor, they want them moving, especially due to the high price of the investment that it represents in inventory. If it was really bad, they'd be willing to take the loss that a price drop to consumers represents and would demand that Sony reimburse them. There have been no public reports of this.

    2) Sony wouldn't be shipping as many consoles as they are currently. How many consoles have they shipped to date? 2 million? []. If they are not selling like you say they are, then the next quarterly report will note a decrease in console shipments (so less than 2 million more shipped). Until then, you can make no conclusions about how the actual console is selling because retailers won't report this information fast enough!

    First person comments do not count! Give me a statistic - a published report of 24 consoles per big box retailer or something. But piles and piles doesn't mean anything to me. Besides, you don't know how many of those are empty boxes. To have a $600 console just sitting on the floor without protection (especially in the smaller Gamestops and EBGames) is kind of stupid since someone will just run out the door with them.

Honesty is for the most part less profitable than dishonesty. -- Plato