Sony loan

[raggedjimmi]

Japanese electronics giant Sony took out an 80 billion yen (US $700 million) loan, which will be used "for general purposes." The company is currently facing the one-two financial punch of rolling out of the PlayStation 3 and the Blu-ray disc format and plans to cut over 10,000 jobs over the next three years. This is the first time that the maker has borrowed money in a decade. According to spokesperson Shinichi Tobe, this loan is more flexible than bonds, and Sony borrowed more than originally planned. These days, everything seems to be more than originally planned at Sony

Sony is also facing costs associated with the manufacture of the PlayStation 3 and the launch of the new Blu-Ray disc format - both of which are due to roll out this year. Last year the company embarked on a three-year cost-cutting exercise that will see the loss of 10,000 jobs.

Sounds like BluRay is going to be more a risk than we thought. Sony having to take out a loan to oversee the PS3 and BluRay worlds. For a company who can't afford to mess up they seem to be isolating the market somewhat.

[lexus]

They basically fail if BluRay does.

[FragTek]

Did I hear correctly somewhere that the PS3 rewrites the game disc once inserted in your system for the first time so that it can only be played on your console? I was like wow this is something only Sony would do, and completely eliminates the game rental scene. Can anyone confirm this?

[raggedjimmi]

That was a rumour, though likely mulled over to prevent Sony's biggest worry - piracy. IIRC BluRay burners are on the market. PS3 has LAN ports. they better pray they have good encryption.

[dmw007]

Hmm, not sounding overly good for Sony's financial state at the moment. :o

Hopefully everything goes okay for them, I think that Sony is normally a good company that offers quality products. :)

[mrgreen4242]

While I'm not going to jump on the "if BluRay fails Sony fails" bandwagon (I'm sure it'll hurt, bad, but who knows if it will be the final blow or not), I will say that I just can't see how BluRay will succeed.

Even with consumer electronics stores like Best Buy pushing BR over HDDVD, people aren't buying it. And with good reason: the players are $1000 and there's only ~25 movies are so at the moment. As such there are only two kinds of people buy BluRay at the moment: AV enthusiasts and suckers.

While I can't speak for the suckers, the AV guys are hardly impressed with BluRay... the player is twice as much as the HDDVD units, there are less titles, and the transfers on those titles appear to be 100% garbage. Further, the 1080p promise of BluRay looks to be a load of crap. 90% of the titles are apparantly being decoded at 1080i60 and then deinterlaced on the player to 1080p60, which is the same thing a 1080p TV set would do, and doesn't add any visual data, either per frame or per second.

With suspected price drops or new, somewhat lower cost, models on the horizon for Toshiba either late this year or early next, and more studios putting out HDDVDs it looks pretty good for HDDVD. That doesn't surprise me, of course, the last 9 formats Sony has tried to introduce have failed pretty miserably... UMD, MiniDisc, Beta tapes, etc.

[FragTek]

BETA ftw! :D The only reason BETA failed was that Sony wouldn't allow any other manufacturers to make BETA VCR's therefor keeping the price high and availability low, leading to its death. The format itself is FAR superior to VHS, if only Sony weren't so damned greedy!

[raggedjimmi]

the last 9 formats Sony has tried to introduce have failed pretty miserably... UMD, MiniDisc, Beta tapes, etc.


Notice how none of them were needed from the mass public? DVDs were needed, cassette tapes were needed, CDs were needed. MP3 is needed especially in 2006.

I don't think BluRay fail=Sony fail is true. but i think this could be a huge wake up call for the company who love to force unwanted objects down our throats. Give me HD-DVD anyday. I'm not foolish enough to spend double for the same end result. especially with the lacklustre BR reviews.

[MacRumorUser]

agreed.

Sony will whether the storm if blu ray fails, BUT.... there will be a lot of blood spilled in Sony HQ

But going on recent nonsense, that will probably be a good thing...

[2nyRiggz]

They really are watching Sony hard this time....everything is reported. I'm hoping sony can shake it off and get back into GAMING (I mean there gaming sector) and stop spilling into there other parts.


Bless

[steviem]

Perhaps they could license OSX and reskin it in a Sony theme....that would end their worries, lol

[17luv]

Personally the only way I would consider getting a blue ray player is a PS3 and as far as Blue ray movies etc-I could care less either way I don't plan on investing heavily into either format until I see one will be staying around. If it weren't for PS systems I would hate Sony altogether and the whole thing with the "extra" installs from their music cds a while back was the icing on that cake.

[steviem]

yeah, rootkits, that put me off buying cds for good, you know...

[raggedjimmi]

They really are watching Sony hard this time....everything is reported. I'm hoping sony can shake it off and get back into GAMING (I mean there gaming sector) and stop spilling into there other parts.


Bless

yea, I really want Sony to jump back to the PS1 days. The Playstation was so new, holding FMV and CD quality audio. but now it's so stale, we don't need FMVs anymore with the quality of graphics (though Sony still seem to love those pre-rendered trailers) I just have this feeling if they focused on the groundbreaking-ness of the PS1 and transferred that to modern day without any silly extras then it would be mighty. Back to the games, please Sony.

[mrgreen4242]

Notice how none of them were needed from the mass public? DVDs were needed, cassette tapes were needed, CDs were needed. MP3 is needed especially in 2006.

I don't think BluRay fail=Sony fail is true. but i think this could be a huge wake up call for the company who love to force unwanted objects down our throats. Give me HD-DVD anyday. I'm not foolish enough to spend double for the same end result. especially with the lacklustre BR reviews.

Why would failed proprietary format #10 be any more of a wakeup call for them than #2-9 were? They seem to be perfectly willing to scam the public by making a competing standard, pushing it hard for a few years, and then bailing on it in favor of whatever the "enemy" was, to make even more money reselling content in a different format.

The only trouble is that this time they have enlisted some other big name helpers to push their garbage even harder than normal, and they have a chance, albeit not a good one, imo, to actually win. Which is bad for pretty much everyone else.

[Haoshiro]

Why would failed proprietary format #10 be any more of a wakeup call for them than #2-9 were? They seem to be perfectly willing to scam the public by making a competing standard, pushing it hard for a few years, and then bailing on it in favor of whatever the "enemy" was, to make even more money reselling content in a different format.

The only trouble is that this time they have enlisted some other big name helpers to push their garbage even harder than normal, and they have a chance, albeit not a good one, imo, to actually win. Which is bad for pretty much everyone else.

Because they would lose more money on this one? They seem to be hanging nearly the entire company on PS3/Blu-ray... and these products are probably there best options to come back to being highly lucrative.

[sam10685]

Did I hear correctly somewhere that the PS3 rewrites the game disc once inserted in your system for the first time so that it can only be played on your console? I was like wow this is something only Sony would do, and completely eliminates the game rental scene. Can anyone confirm this?

that does sound like something sony would do, however, it would be incredibly stupid.

[snakelda]

Did I hear correctly somewhere that the PS3 rewrites the game disc once inserted in your system for the first time so that it can only be played on your console? I was like wow this is something only Sony would do, and completely eliminates the game rental scene. Can anyone confirm this?
I read somewhere that that was false....I don't know where though.....it was some time ago

[sk1985]

They basically fail if BluRay does.
No, if I'm not mistaken sony has 60 billion dollars in assets. They're still a pretty large company. 700 mill is a drop in the bucket.

[kuyu]

I happen to work in corporate finance at a large company, and this sort of thing is commonplace. Why? The first rule of investing; always use someone else's money. Basically you can leverage up your profits if you use someone else's money to fund everything.

I wouldn't worry too much about Sony as a whole. Multinational companies rarely flop all together. More likely, Sony will begin selling off it's underperforming segments if/when they hit hard times. Then they will re-organize and dump money into the profitable segments. Then use that money to buy technology for new segments... Thus is the cycle of our corporate world.

[dmw007]

No, if I'm not mistaken sony has 60 billion dollars in assets. They're still a pretty large company. 700 mill is a drop in the bucket.


Well, if that is the case, then Sony can afford to lose $700 million. :)

[ddrueckhammer]

Well, if that is the case, then Sony can afford to lose $700 million. :)

If they are just gonna give money away then I'll give them my address. :D Seriously, I think that Sony has a hard road ahead of them if they price the PS3 any more than $499. People will just buy a 360 and/or Wii. Also, I know they will get Square titles and all but the 360 already has some cool games with Fight Night and Call of Duty 2 etc... Even at $499, it better not be the completely useless stripped down model either...

[princealfie]

looks like sony is pretty much flunked... they need open source and bad too... they are becoming the microsoft of japan very quickly.

[Counterfit]

they are becoming the microsoft of japan very quickly.
Not really. They don't have nearly the dominant market share there. And I don't hear many people complaining about Microsoft's Product X being way too expensive (although within the last year, I have seen full priced versions of ME on a shelf at CompUSA).

[17luv]

If they are just gonna give money away then I'll give them my address. :D Seriously, I think that Sony has a hard road ahead of them if they price the PS3 any more than $499. People will just buy a 360 and/or Wii. Also, I know they will get Square titles and all but the 360 already has some cool games with Fight Night and Call of Duty 2 etc... Even at $499, it better not be the completely useless stripped down model either...

I think they will find a lot of initial interest from die hard fans and those who have more disposable income but after that it will be interesting to see how they do. Something I read (updated and more knowlegdable folks correct me if I am wrong) that outside of a few games targeted specifically at the "groundbreaking" technology of the PS3, games that will be cross-platform won't be taking advantage of those features just keeping what works for the bottom denominator the 360/Wii. If that is the case (for me at least) there wouldn't be a need for me to buy a PS3 outside of the fact that the new Final Fantasy game looks AMAZING but if 360 or the Wii can play Assasin's Code/Creed (forget the title) then I will just pocket that extra $$$ :D

[raggedjimmi]

Yea it'll be like this generation, all games made to work on the weakest system leaving the Cube will all power and no glory. Shigsy recently said that no Cube game, not even Twilight Princess pushes the Cube to it's maximum power. Makes you think what a Tony Hawks game made specifically for the Cube might look like.