Sony's recent redressing of the PS3's production problems has made it profitable according to Richard Doherty, an analyst at the US research firm Envisioneering Group.
The analyst told Bloomberg that thanks to Sony's resolution of its production issues the PS3 has actually been profitable for several months, while he reckons that Microsoft loses money on every Xbox 360 it sells.
“Any price cut they try to make puts them more into the red,'' says Doherty of the 360.
When Sony announced the PS3's US price cut and 80Gb version release Jack Tretton said, "We've gotten our production issues behind us on the PlayStation 3, reaching a position to pass on the savings to consumers, and our attitude is the sooner the better".
That did not, however, indicate that the PS3 is now a profitable piece of hardware.
If Sony is in fact making a profit on each PS3 sold, that would certainly be a marvellous piece of business. While Sony has always been coy about the manufacturing costs of the PS3, it was widely believed to initially cost around $240 (£118) more than the 60Gb version's original retail price of $599 (£296) to manufacture.
While Sony has had over six months to streamline its production process, a reduction to the point where the PS3 is already profitable seems unlikely.
SPOnG would be very interested to hear where Mr Doherty got his figures from.
The analyst told Bloomberg that thanks to Sony's resolution of its production issues the PS3 has actually been profitable for several months, while he reckons that Microsoft loses money on every Xbox 360 it sells.
“Any price cut they try to make puts them more into the red,'' says Doherty of the 360.
When Sony announced the PS3's US price cut and 80Gb version release Jack Tretton said, "We've gotten our production issues behind us on the PlayStation 3, reaching a position to pass on the savings to consumers, and our attitude is the sooner the better".
That did not, however, indicate that the PS3 is now a profitable piece of hardware.
If Sony is in fact making a profit on each PS3 sold, that would certainly be a marvellous piece of business. While Sony has always been coy about the manufacturing costs of the PS3, it was widely believed to initially cost around $240 (£118) more than the 60Gb version's original retail price of $599 (£296) to manufacture.
While Sony has had over six months to streamline its production process, a reduction to the point where the PS3 is already profitable seems unlikely.
SPOnG would be very interested to hear where Mr Doherty got his figures from.
Companies:
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Comments
crs117 9 Jul 2007 21:42
1/7
news piece just in...sony is full of s**t.
three days later...
any questions???
-c
"At present we have no plans," [to cut the PS3 price], Ryoji Chubachi told Reuters in an interview.
Friday, 06 July 2007
http://www.next-gen.biz/index.php?option=com_content&task=view&id=6272&Itemid=2
Friday, 06 July 2007
http://www.next-gen.biz/index.php?option=com_content&task=view&id=6272&Itemid=2
three days later...
Sony announces price cut, new 80GB PlayStation 3 model for North America
By Ben Kuchera | Published: July 09, 2007 - 08:10AM CT
http://arstechnica.com/news.ars/post/20070709-sony-announces-price-cut-new-80gb-playstation-3-model-for-north-america.html
By Ben Kuchera | Published: July 09, 2007 - 08:10AM CT
http://arstechnica.com/news.ars/post/20070709-sony-announces-price-cut-new-80gb-playstation-3-model-for-north-america.html
any questions???
-c
realvictory 9 Jul 2007 21:43
2/7
In some ways, I think, it does cost so much, how can they not make a profit? Maybe they bought back all the ones off ebay for cheaper than they sold them for, to make extra money back when they resold them back to the shops?
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ozfunghi 9 Jul 2007 22:28
3/7
Hey, i didn't know you didn't need to have any credentials to become an annalist. Or any common sense or the faintest idea of what you're talking about! Where do i sign up!?
ultimateassmonkey 10 Jul 2007 10:16
4/7
No wonder they are making a profit... Or might be making a profit.
How much more are we Brits paying for the console compared to others around the world?! Come on people... Look at it... £425 for the console here in the UK (well, was at launch and should be at the moment) and in the land of the rising sun, the same model is touching 60,000yen (I think) which is approx. £240. Do the math.
We Brits get totally ripped off... No wonder they are making a profit.
How much more are we Brits paying for the console compared to others around the world?! Come on people... Look at it... £425 for the console here in the UK (well, was at launch and should be at the moment) and in the land of the rising sun, the same model is touching 60,000yen (I think) which is approx. £240. Do the math.
We Brits get totally ripped off... No wonder they are making a profit.
tyrion 10 Jul 2007 12:48
5/7
crs117 wrote:
any questions???
Yeah, I've got one. "Where in the story does it say the information on profitability comes from Sony?"
OptimusP 10 Jul 2007 14:09
6/7
"Sony Playstation 3 Is Profitable Says Bribed Analyst"
Fixed ;)
Fixed ;)
crs117 10 Jul 2007 16:23
7/7
tyrion wrote:
crs117 wrote:
any questions???
Yeah, I've got one. "Where in the story does it say the information on profitability comes from Sony?"
i never said that sony stated they were now profitable with the ps3...i just said that they are full of s**t. if we are going to get so technical on the semantics then you obviously put as many words in my mouth as i put into yours....but i guess thats how you play the game.
When Sony announced the PS3's US price cut and 80Gb version release Jack Tretton said, "We've gotten our production issues behind us on the PlayStation 3, reaching a position to pass on the savings to consumers, and our attitude is the sooner the better".
my whole point is with the above comment. i am sure this comment is full of more s**t then sony wants to admit. to drop the ps3 price without announcing some level of price reduction in the manufacturing of the ps3 would only f**k up sony's share price even further....thus the above full of s**t quote.
i would be willing to bet they are losing just as much money now with the dropped price per console as they were when they introduced it...if not more money per console. i doubt the manufacturing process has been cut $100 yet.
-c