Sony's $3.3 Billion Loss Since PS3 Launch

[IIJoshIII]

Sony takes $3.3 billion loss on PS3 hardware - VideoGamer.com

[Blasterpez]

well, on a down side, if sony fails and stops being involved in the game market...then what will balance MS? unopposed, if MS is the only game (yes, i know, sweet pun) in town for consoles, they can get crazy greedy and charge who knows what for the next gen, next-gen consoles.

also, what will happen to all the ps3 owners if sony decides to pull the plug? it makes me not want to buy one, that is for sure. even if they get cheap...what would the point be if sony doesn't support it, or won't support it for long? think they may hook up with nintendo, like they almost did back in the day?

[blu_yu_away]

If I remember right, I am pretty sure Microsoft was losing money on hardware up until not too long ago. Maybe not this much but I do remember not long ago a pretty big deal being made about Microsoft's first quarter of profits on 360 consoles. That damn Wii on the other hand...

[rabbitc]

to be fair - the X360 only just started making money (although this would have happened sooner if it weren't for the ****e Xenon mb's)

However, this loss was very predictable and believe me - this will not sit well with shareholders.

Senior executives at Sony have been trying to float this dual-industry (gaming and film) market attack for quite a while - and although the PS3 is selling, BluRay's performance has been abysmal since the collapse of the format war and industry partners are fed up with being undercut by Sony's all-in-wonder-machine that is leaving little room for anyone else to make a meaningful entry into the hidef market.

I won't dwell on rhetoric as many know my feelings about Sony's strategies in depth - but as a loyal Sony customer myself, it does feel as though Sony has lost it's way over the last few years.

The market has handed them '1st prize' in the hidef war - yet all the top brass at Sony seem to be stumbling around wondering what to do with it. It was a brave (and somewhat misguided) move to use the PS3 to launch a war on two fronts - and the PS3 has become a paradox that Sony must now resolve - it is the most expensive console in the gaming market meaning that Sony must rely on 'BluRay' games to justify it's ticket price - yet it has also become an extremely inexpensive BluRay player which is sold below cost and offsets their own cinema division including their partners.

[Pepper Jack]

it could start to make some money, i know that more of my friends have bought PS3s lately than ever before, only a few got one at or near launch but now there is like 10 who have bought one in the last few months or thinking of buying one soon

[friedkarma]

I don't think its any big secret that consoles are loss leaders deep into their lifecycles. The profits come from software and licensing, which is Sony's Achilles Heel this generation, not hardware.

[bevo1981]

i don't know what it is now, but when Sony first put out the PS3 they lost money on every system that was sold, with the goal being to make profit on the games rather than the consoles. i remember one figure said that they lost about $100 for every console sold.

[remixFA]

sony lost something to the tune of 350-400 on every console sold at launch. And for the most part, the consoles have gotten cheaper, and reduced priced, so are still probably still losing about that much per console. MS also never saw the black side of the profit/loss statement the whole way through the xbox1 cycle, and it wasnt until the H3 launch i believe that they did anything but sit in the red. This is something new to sony as the ps1 and ps2 were cash cows, and im sure they didnt think it would be 1/10th as bad with their early statements like "the next gen doesnt start until we say so" and crap like that.

Chuckyboy is very right in his statements about the electro-enigma that is the PS3 in the 2 worlds it tries to fit in. Its the cheapest and one of the best BR players on the market. If it werent for the ps3, the "format war" would either still be going on, or HDDVD would of won out a while ago. At the same time, they expected to ride on a huge wave of people that would buy a ps3 now that the "war" was over, and the ps3 played the only tangible HD content left to buy. Exept for the initial bump, this hasnt happend.

MS made the right move in not choosing one format over the other to put in its consoles, otherwise, the 360 would not have sold as much initially. The add on (which I own as well as a ps3) is a "great if it wins, so what if it doesnt" throw away drive, unlike BR in the ps3. Hell, if HDDVD would have won the format war, who knows how poorly the ps3 would be doing.

If you ask most peeps what they use their ps3 for, they will prob say BR playback, not videogames, and that is the whole reason the ps3 will continue to flop around in last place.

[blu_yu_away]

Originally Posted by bevo1981

i remember one figure said that they lost about $100 for every console sold.

When the PS3 was first released I remember hearing figures as high as a $250 loss per console I believe, however production costs have certainly dropped (cut nearly in half I believe). The production cost of the console is a lot higher than 360 or Wii. Sales will continue to rise however, and profits will rise as well. Just look at the change from fiscal year 2007 to 2008 where the loses were cut by $1 billion.

[remixFA]

Originally Posted by blu_yu_away

When the PS3 was first released I remember hearing figures as high as a $250 loss per console I believe, however production costs have certainly dropped (cut nearly in half I believe). The production cost of the console is a lot higher than 360 or Wii. Sales will continue to rise however, and profits will rise as well. Just look at the change from fiscal year 2007 to 2008 where the loses were cut by $1 billion.

is that after they added in the PS2 console/game sales??

[ElderScroller27]

it's really strange though. it's like sony isn't trying to seriously compete on a global scale. They are going through the motions but what they deliver is just so lacking in quantity or vision...... I honestly wasn;t sure what console to buy until I thought about Oblivion and Halo 3..... now here I am at almost 2 years owning a 360 and i am GRATEFUL that I didn't saddle myself with a PS3.

[rabbitc]

Originally Posted by remixFA

is that after they added in the PS2 console/game sales??

That's not how investments are evaluated.

[axeman2008]

I dont know anyone who uses their ps3 more than their 360 it's like Sony is developing a console no-one wants or needs. And as for Blu - Ray movies when was the last time anyone went out to buy a film on that format rather than saving a few quid and buying a standard dvd which will be upscaled to near as dammit blu - ray quality?

[Pepper Jack]

i own some blu rays, they look pretty good on the tv in my room but the 1080p tv downstairs makes them look pretty amazing, i'll buy the odd few films on blu-ray (usually just action films) if i think they are good enough to shell out that stupid kinda money on, but i'm not exactly gonna rebuild my collection on blu ray, way too expensive

[axeman2008]

Originally Posted by Pepper Jack

i own some blu rays, they look pretty good on the tv in my room but the 1080p tv downstairs makes them look pretty amazing, i'll buy the odd few films on blu-ray (usually just action films) if i think they are good enough to shell out that stupid kinda money on, but i'm not exactly gonna rebuild my collection on blu ray, way too expensive

Absolutely, i haven't actually bought a single blu-ray movie yet and i don't think i ever will.

[XabiTorres]

Originally Posted by Pepper Jack

i'm not exactly gonna rebuild my collection on blu ray, way too expensive

Thats what everyone said when DVDs were new

[Kona Palangi]

HAHA ... And how long did it take them to rebuild their collection from VHS to DVD?

[bevo1981]

the difference between VHS and DVD is gargantuan compared to the difference between DVD and Blu. a lot of people got phased out of VHS because the industry stopped producing movies in that format. they had no choice but to convert to the DVD world. as long as we have the option between DVD and Blu, i think DVD will win out.

[Pepper Jack]

Originally Posted by XabiTorres

Thats what everyone said when DVDs were new

ok i should change it to...i'm not gonna rebuild my collection with blu rays until they become really cheap like dvds did

happy?