Sony to Make PS4 Profit Straight Away
Analysts say that Sony has learned from PS3 mistake
Unlike the PS3, which is going to go down in Sony history as an expensive launch console that didn't exactly burnish the brand - it appears that the PS4 is going to make money from the get-go.
OK, sure, forensic economists will point out that 'not lose money' is different to 'make money' and they'd be right. So what's the score.
"The bill of materials (BOM) for the PlayStation 4 amounts to US$372. When the manufacturing expense is added in, the cost increases to US$381. This comes in US$18 lower than the US$399 retail price of the console."
So says a report in ElectronicsNews
The report quotes Andrew Rassweiler, senior director, cost benchmarking services for IHS, “When Sony rolled out the original model of the PlayStation 3 in 2006, our teardown analysis revealed that the console delivered supercomputer-class performance at a price equivalent to a notebook PC,” said
“However, this achievement came with a major downside for Sony, as the BOM costs for most of the different versions of the console were in excess of the retail prices, in some cases by more than US$100. Although Sony brought the PlayStation 3’s costs down significantly during its lifetime, the company’s intent was never to make money on the hardware, but rather to profit through sales of games and content.”
We hope Ken Kutaragi is pleased.
OK, sure, forensic economists will point out that 'not lose money' is different to 'make money' and they'd be right. So what's the score.
"The bill of materials (BOM) for the PlayStation 4 amounts to US$372. When the manufacturing expense is added in, the cost increases to US$381. This comes in US$18 lower than the US$399 retail price of the console."
So says a report in ElectronicsNews
The report quotes Andrew Rassweiler, senior director, cost benchmarking services for IHS, “When Sony rolled out the original model of the PlayStation 3 in 2006, our teardown analysis revealed that the console delivered supercomputer-class performance at a price equivalent to a notebook PC,” said
“However, this achievement came with a major downside for Sony, as the BOM costs for most of the different versions of the console were in excess of the retail prices, in some cases by more than US$100. Although Sony brought the PlayStation 3’s costs down significantly during its lifetime, the company’s intent was never to make money on the hardware, but rather to profit through sales of games and content.”
We hope Ken Kutaragi is pleased.
Companies:
Sony
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Comments
DrkStr 20 Nov 2013 13:57
1/2
So what amount of loss do they actually make given the £399 includes a cut for retailers and distributors and doesn't include shipping or warehousing?
ergo 20 Nov 2013 21:34
2/2
Utter nonsense: they are *losing* substantial money on every unit sold (maybe not the huge money the lost per PS3, but they are certainly losing upwards of $100/box on PS4).
There are these things called marketing, R&D, shipping, currency fluctuations, etc, etc. that are all factored into the cost of the final product. Sony *themselves* said they were making a loss on every unit *months* ago, yet you're here telling us they're miraculous now not losing money?? Do you guys know *anything* at all about product manufacturing?? Nope!
There are these things called marketing, R&D, shipping, currency fluctuations, etc, etc. that are all factored into the cost of the final product. Sony *themselves* said they were making a loss on every unit *months* ago, yet you're here telling us they're miraculous now not losing money?? Do you guys know *anything* at all about product manufacturing?? Nope!