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Sony posts biggest loss in 4 years
- Thread starter Lee
- Start date
How long can they go on making these sorts of losses before it all ends, one would imagine Sony have alot of money in the bank, so to speak.
SLK 350
Why are people surprised to hear this? It's widely known and documented that Sony are making an initial loss of circa $300 on every PS3 sold at RRP. It's far from unusual for a company to be taking a hit on a good product after R&D/materials/production are taking into consideration.
Their saving grace is that in the long run (i.e 5 years) the product at the centre of this the PS3 will be raking it in for them, as production costs fall, at some point on the timeline they will start making a profit on the consoles.
The fact is, they have a very good product, and with marketing and some pivotal games releases it will start the ball rolling more quickly, the other limiting factor is peoples inability/confusion over the HD war and which way it is likely to swing.
I'm pretty sure the losses won't come to the surprise of Sony, it's share holders, or anybody else in the industry.
Their saving grace is that in the long run (i.e 5 years) the product at the centre of this the PS3 will be raking it in for them, as production costs fall, at some point on the timeline they will start making a profit on the consoles.
The fact is, they have a very good product, and with marketing and some pivotal games releases it will start the ball rolling more quickly, the other limiting factor is peoples inability/confusion over the HD war and which way it is likely to swing.
I'm pretty sure the losses won't come to the surprise of Sony, it's share holders, or anybody else in the industry.
Some good sense in there. However, dont presume that the PS3 will have such a dramatic impact on the console market as PS2 did. Firstly - this time around Microsoft don't just have a foot in the door (Xbox), they're sitting infront of the fire sipping brandy. Second - do people really want all-in-one home systems? The presumtion is that sooner or later PS3 will take market dominance like of the same magnitude as the PS2. That is not a sensible view IMO.
Personally I am not overly bothered over the PS3 vs. X360 argument. Mainly because all I want is good games, and also because I'm a PC gamer who can't be arsed to get back in to the console world just now.
SLK 350
Indeed I welcome the fact that there is a three horse race (you forgot about little old Nintendo), it's good for the consumer and it ensures each party on their feet and working hard to maintain or steal margins from the competition.
However I notice that the title is "biggest loss in 4 years" well when you think that the R&D/production/marketing/materials/distibution of the PS3 all will have fallen in 2005-2006 then there really is little surprise.
The PS2 sales are dwindling, and for the first time in 1/2 a decade Sony have a gap in their product in which the PS2 is no longer meeting expectation, and the PS3 hasn't yet received the development time it needs to churn out some essential titles.
I don't think they'll be any pay cuts or redundancy at Sony because of these figures, nor do I think they'll be cutting back on the free Klix coffee.
People love a david and goliath story, I personally have little love for Sony myself after the stunt they pulled on Lik-Sang but it doesn't stop me seeing what a good product the PS3 is, and what it can strive to be.
Within 5 years I think they'll be muchos laughter from Sony about these statistics.
