PS3 loses $2 Billion

[MacRumorUser]

eek, thats a lot of moola.

vnunet.com exclusive:
Sony PS3 loss 'to reach $2bn' by March
New chips may not be enough to stem losses, analysts say

Simon Burns in Taipei, vnunet.com 31 Jan 2007



Sony's games division losses will be worse than expected and could exceed $2bn for the fiscal year ending in March, vnunet.com can reveal.

Executives told reporters and analysts in Tokyo today that they blamed a shortfall in sales of the costly PlayStation 3 video games console and the PlayStation Portable (PSP).

Sony's net profit fell more than five per cent to $1.3bn in the last three months of 2006. The games division suffered an operating loss of $455m during the quarter, a fall of almost $1bn from the previous quarter, according to Sony.

"This deterioration was primarily the result of the loss arising from the sale of the PS3 at strategic price points, as well as other charges associated with preparation for the launch of the PS3 platform," the company announced.

"In addition, operating income from the PS2 and PSP businesses fell due to sales declines."

Sony has been shocked by the strong sales of Nintendo's much cheaper Wii console, according to analysts, and has had to fight the entrenched strength of Microsoft's Xbox 360, which was launched more than a year ago and now has a wide range of games.

Sony's predicted loss on the first six months of PS3 sales now exceeds the $1.3bn Microsoft is estimated to have lost on Xbox 360 sales over the same period of that console's life-cycle.

Analysts have suggested that Sony will be able to cut PS3 manufacturing costs and retail prices later this year when it revamps the console with smaller ver sions of the Cell CPU and RSX graphics chip.

"How and when the company intends to address the problem of weak demand for PS3 hardware remains unclear. In our view, making the PS3 profitable will not be an easy task," said Eiichi Katayama of Nomura Securities in a briefing to clients.

Sony executives are now saying that the games division loss for the financial year ending in March will exceed earlier predictions of $1.65bn, and might go as high as $2.05bn, according to sources present at a Sony investor briefing in Tokyo today.

Nomura's analysts have stated that they expect the results to be even worse.

Despite the bad news from Sony's games division, better than expected results from its consumer electronics products had helped offset the loss, Katayama said. Sony highlighted TVs as a strong seller during the Christmas season.

Although media attention has focused on the high-profile PS3, older games products are also giving cause for concern at Sony.

"We think that a critical stage is approaching for the PSP, which in our view occupies an ambiguous market position as a game console and a multi-purpose audiovisual machine," said Katayama.

[steamboat26]

Wow :eek:

But how much can Sony "afford" to lose on the PS3?

[sikkinixx]

Sony needs to hit the reset button back to 2004 and start over...

[MacRumorUser]

Sony's predicted loss on the first six months of PS3 sales now exceeds the $1.3bn Microsoft is estimated to have lost on Xbox 360 sales over the same period of that console's life-cycle.

So if sony loses the same amount of money in 6 months as M$ has in 12 months. Are they losing that much money on each unit sold :eek: If so... I can understand why they said they dont forsee a price cut for 2 years...

[zelmo]

Any console needs a steady stream of AAA titles to succeed. PSP has only had a handful of great games, and PS3 only has R:FoM.
Get titles on the shelves, and all this bad crap melts away.

[sikkinixx]

So if sony loses the same amount of money in 6 months as M$ has in 12 months. Are they losing that much money on each unit sold :eek: If so... I can understand why they said they dont forsee a price cut for 2 years...

its not just the units they lose money on, advertising, production problems, air freight as opposed to sea freight for launch (air for 500k units = $$$$$$$$$$$) blah blah blah, all sorts of crap that nickel and dime ( ok maybe more than nickel and dime ;) ) the company into loss

[Haoshiro]

It didn't help that so many of there PS3 sales were from scalpers, and then those scalpers had problems selling the systems.

Add on to that a very VERY bad attach rate for the system. Companies sell these systems at a loss expecting to make up for it with software, etc... but if people aren't buying software (and instead installing Linux and playing PS2 games they already own)... well, that is bad for them.

I'm sure there will be investors willing to dump money into the brand for a long time though, so no worries yet.

[princealfie]

Congrats, Sony. May you decline further! :D

[Dagless]

Microsoft lost $4 billion with the Xbox 1. Sony lost $2 billion so far with the PS3.

"OMG nintendo are SEGA and will go away cuz yea" :D

Isn't the Playstation line [usually] Sony's biggest profit maker?

[Swarmlord]

Maybe they can make it up in volume! :eek:

My son settled on a Wii and hasn't regretted the decision.

[2nyRiggz]

Indeed Haoshiro, Sony really need to get those titles pumping and do not sleep like they did the PSP...the PSP is just waking up and its been on the market for two years. Sony is really lackluster and from the looks of it...they don't like money as much as the other companies.



Bless

[Dagless]

Oh wait. Another negative in the "HD camp". Not only are systems costing more, games taking longer and costing more to develop, but the development of the system costs more too :eek: I mean I bet the PS3 went through a lot of designing to get it running as cool as what people say.
A weaker CPU & GPU would have sorted that :D

I've been saying the push was too soon for a while now.

Poor Sony. They need to rekindle the magic the PS1 had :o

[paddy]

It would be so much better if they took out that stupid bluray drive. That'd bring it to 360 prices and then it would sell like crazy

[2nyRiggz]

Price cuts is been considered...ummmm

http://www.gamespot.com/news/6165103.html?tag=latestnews;title;0


Bless

[jdechko]

Microsoft lost $4 billion with the Xbox 1. Sony lost $2 billion so far with the PS3.

"OMG nintendo are SEGA and will go away cuz yea" :D

Yeah, the difference is that Sony and MS have other sources of revenue that are able to offset at least some of the losses (IE: Deeper pockets). As a direct result, however, MS and Sony can absorb a lot more of the costs while still remaining competitive. Sony just has a lot of ground to make up now, and it seems like they are constantly making wrong turns.

[Coded-Dude]

Microsoft lost $4 billion with the Xbox 1. Sony lost $2 billion so far with the PS3.

"OMG nintendo are SEGA and will go away cuz yea" :D

Isn't the Playstation line [usually] Sony's biggest profit maker?

MS lost somewhere closer to 7 billion.
(and thats without R&D costs on a completely new CPU)
Sony knew they were gonna take a hit, and expect to be making profit next year........

[sikkinixx]

Maybe Sony would get more sales if they tried to be a bit nicer to its users. I have always thought that Sony needs to be more user friendly. I mean the hardware they have is pretty great. Like the PSP can do so much and has so much potential (even if the stupid analog nub was in the wrong spot) but they have to do something stupid like close it off to home brew, imagine if they let you use home made apps and such, and constantly delay things like that GPS and the Camera.I can just see the PS3 being the same. Some of the features like the Remote Play could be so sweet if it was done right, but Sony never seems to finish what they start (granted they just launched PS3). Ah well, they already have my money so I just hope they can pick them (PSP/3) up...

[greatdevourer]

MS lost somewhere closer to 7 billion.
(and thats without R&D costs on a completely new CPU)
Sony knew they were gonna take a hit, and expect to be making profit next year........ They lost $4b on the original XBox, unless they're trying to hide $3b. Maybe they've lost $7b in total, but the original XBox was totalled up at $4b after the last one rolled off the production line

[Haoshiro]

MS lost somewhere closer to 7 billion.
(and thats without R&D costs on a completely new CPU)
Sony knew they were gonna take a hit, and expect to be making profit next year........

The difference is pretty vast when you consider the overall company profits.

From what I understand almost all of Microsoft is profitable (all divisions), and Nintendo even profits from their hardware.

Sony on the other hand, from what I gather, only has a single profitable division: SCE. Losses are more financially burdensome to a company with less overall profit.

Take Xbox for example, Microsoft had that cash to throw around, and went in intended and expecting to lose that money. Unlike Sony who seems to be losing more money then the planned on.

But like I said, the Sony brand is big, I'm sure they'll have plenty of investors to keep them afloat. Now if they start scaring them away, that's a different story. But that's a worse-case scenario I'd say.

[gkarris]

Not to mention people buying them as a Blu-ray player...

[pseudobrit]

It would be so much better if they took out that stupid bluray drive. That'd bring it to 360 prices and then it would sell like crazy

It'd also suck when the third-year titles needed multiple DVDs worth of space to be worth a damn.

I even had a PS2 game that needed two DVDs last year.

[Coded-Dude]

It would be so much better if they took out that stupid bluray drive.
Whats so stupid about it......?

[pseudobrit]

From what I understand almost all of Microsoft is profitable (all divisions), and Nintendo even profits from their hardware.

I remember very clearly hearing that MS only sees profits from its OS.

*Googling... yup*: http://slashdot.org/articles/02/11/17/2037223.shtml

[Haoshiro]

I remember very clearly hearing that MS only sees profits from its OS.

*Googling... yup*: http://slashdot.org/articles/02/11/17/2037223.shtml

A 2002 article? heh

[Dagless]

Whats so stupid about it......?

Haha. Bloody hell. It's bumping the cost up. It's like being forced into buying a 360 AND a HD-DVD drive when you only want to play games.

[pseudobrit]

A 2002 article? heh

You think the numbers have shifted all that much? I'd still believe MS makes nearly all their money on the OS licenses and Office. Not much has changed, really. The console market is relatively small in the grand scheme of things.

You saw the MWSF '07 keynote, yes?

[pseudobrit]

Haha. Bloody hell. It's bumping the cost up. It's like being forced into buying a 360 AND a HD-DVD drive when you only want to play games.

Apple killed the floppy and gave us USB and people cried bloody murder and mocked them. But the floppy was **** and needed to die. Apple today releases limited-spec machines with narrow upgrade paths and people decry the lack of third-party hardware choices. But we're not going ******* crazy trying to deal with driver conflicts and chasing down an endless trail of bugs for every piece of marginal kit dumped on the market from China.

We're better off for being forced to march forward down the proper path. You don't give people what they say they want. You give them what they need.

[Dagless]

We're better off for being forced to march forward down the proper path. You don't give people what they say they want. You give them what they need.

Sorta true. But do people need BluRay? I'm seeing Gears of War and other HD games, Half Life 2, CRYSIS, Doom 3 etc... fitting on a single DVD. Xbox offering HD films over the internet...

Where does BluRay, or even HD-DVD fit into all this?

Oh. That's right. Anti-piracy for Sony.

Dont give consumers what they want, don't get them what they need, give them what will make the big business the most money.

[pseudobrit]

Anti-piracy for Sony... give them what will make the big business the most money.

Transparent anti-piracy tools are essential for the tech market's advancement. Without money, there's no incentive to innovate or produce content. The trick is getting the balance right. Blu-ray has no traces of copy protection for the legitimate user.

Do you think we'd still see Adobe products on the Mac if Photoshop were easy to steal on the platform?

edit: I had a PS2 game that ate two DVDs. I can see third-year PS3 games filling out 35GB+ easily.

[Cassie]

heh heh, I'm glad. I REALLY hate Soney. Just.... I don't know what it is about them. I've just never liked them. Maybe I just think Sony will become a monopoly like MS....

Plus the PS3 looks really wierd.

Woot, 1000th post!:D

[Dagless]

edit: I had a PS2 game that ate two DVDs. I can see third-year PS3 games filling out 35GB+ easily.

FMV ladened?

Seriously. Look at the list I just mentioned. Crysis, the most technologically advanced video game yet and it will be fitting on a standard DVD. They've mapped out a whole island... Do I really have to go into detail?
FMV needs to die now. We've got systems powerful enough to render them useless.

[zap2]

Apple killed the floppy and gave us USB and people cried bloody murder and mocked them. But the floppy was **** and needed to die. Apple today releases limited-spec machines with narrow upgrade paths and people decry the lack of third-party hardware choices. But we're not going ******* crazy trying to deal with driver conflicts and chasing down an endless trail of bugs for every piece of marginal kit dumped on the market from China.

We're better off for being forced to march forward down the proper path. You don't give people what they say they want. You give them what they need.


Only problem with the floppy to DVD is the DVD isn't half as old as the floppy was..the floppy was around for decades when Apple made the move to kill it...the DVD has been out what, 7-8 years?

[j26]

.....

We're better off for being forced to march forward down the proper path. You don't give people what they say they want. You give them what they need.

I agree with the first part of your post, but the part I've quoted really scares me for some reason.

It's a bit like Rousseau saying people need to be forced to be free.


<Shrugs shoulders uncomfortably>

[LethalWolfe]

I can see third-year PS3 games filling out 35GB+ easily.
Maybe a PS3 exclusive or two, but it won't be the norm. From what I've heard many third party developers don't think the extra space on BD is a big deal because when they make cross platform games it's not cost effective to spend the extra time and money making a "bigger version" for the PS3. They'll make a game that fits on on a standard DVD and then tweak for each platform as needed. Exclusive games will be reluctant to spend the extra time/money exploiting BD's disc size as well because they have a smaller target audience (1 console vs 2 or 3 consoles).

As raggedjimmi pointed out there are some very visually impressive looking games coming out (I'll add BioShock, Mass Effect, and Assassin's Creed to the list) that won't require a BD disc.


Lethal

[ReanimationLP]

Wow, thats a hell of a cash bleed.

[Cooknn]

Am I supposed to feel sorry for them? I hear a lot of complaining about how the PS3 is too expensive. As soon as I press submit for this post I'm hitting the couch to watch another Blu-Ray movie. Got a great price for a BD Player that doubles as a game console.

It seems like developers are taking longer to get their titles to the PS3, so maybe there's more than porting going on. Lot's of titles in the pipeline. Anyways, Sony can afford it. Funny though, they're losing $Billion's supposedly, but they blew off Immersion and Force Feedback for chump change :rolleyes:

[pcypert]

How can you say HD games are taking long to get out? Wasn't Mario Galaxy and a few other Wii games recently pushed back too?

Paul

[MacRumorUser]

How can you say HD games are taking long to get out? Wasn't Mario Galaxy and a few other Wii games recently pushed back too?

Paul

I agree, and how many delays did Zelda get also :rolleyes: I pre-ordered mine in March 2004 for heaven sakes.

A HighDef game may cost more to produce, but it doesnt necessarily take any longer to produce than a standard def game. The same things have to go into both.

[darkwing]

I agree, and how many delays did Zelda get also :rolleyes: I pre-ordered mine in March 2004 for heaven sakes.

A HighDef game may cost more to produce, but it doesnt necessarily take any longer to produce than a standard def game. The same things have to go into both.

Nothing Nintendo makes is HD because their hardware won't support it.

Zelda was delayed so it could be a Wii launch title. Cube owners (like myself) were delayed over a year and then forced to wait another month so the temptation to buy a Wii could grab us. Didn't work on me! :p

[Dagless]

How can you say HD games are taking long to get out? Wasn't Mario Galaxy and a few other Wii games recently pushed back too?

Paul

If you honestly think all games follow a single timeline for releases then what are you doing here? Story, engine, music, all take different times to make.
When I say HD gaming, I don't mean Alien Hominid or Worms HD. I mean Zelda with HD graphics or whatever (the Oblivions of the world). As a rule of thumb it takes longer, why?

-Number of characters=variation=tricks to avoid the repetitive look. In something like Dead Rising; you'll need to make more costumes for enemies so you dont get a wave of zombies wearing a small number of different shirts.
-Texture quality. Friend of mine is a 3D texture artist (funny really, he said "it's like being an undertaker, there will always be a need for one!"), in his early hobbyist days of Quake he would steam ahead. Now it takes much longer because there is so much detail to include.
-Better AI is something that keeps cropping up. Even using what I've learned from 2D game design I could concoct a basic AI as seen in Goldeneye or Quake. Simple path finding is all. But Half Life 2 or FEAR? They probably took so long to perfect.

I despair.

[iW00t]

Congrats, Sony. May you decline further! :D

I too wish to see Sony go down, but it is not like 2 billion is going to hurt them. 20 billions perhaps, but 2 billion is chump change :(

[sikkinixx]

I agree with the first part of your post, but the part I've quoted really scares me for some reason.

It's a bit like Rousseau saying people need to be forced to be free.


<Shrugs shoulders uncomfortably>


but what he said is true, people as a whole don't know what they want or what they need. Someone needs to tell people what to do, or people just do what is best for them, which is worse for everyone.


But anyways! Enough of the serious stuff.

The Bluray in the PS3 is all well and cool but I can't see myself buying lots of movies on it until I know it will be the next standard. And I know that won't happen unless I buy lots of movies, which helps sales, which will push bluray ahead of HD-DVD. *sigh*

[jdechko]

but what he said is true, people as a whole don't know what they want or what they need. Someone needs to tell people what to do, or people just do what is best for them, which is worse for everyone.

Hooray for capitalism, consumerism and the overall general decline of human society and personal responsibility. :) </sarcasm>

[sikkinixx]

Hooray for capitalism, consumerism and the overall general decline of human society and personal responsibility. :) </sarcasm>

I would much rather enjoy the decline of the world on a 50" LCD TV than using candles to light my house while waiting to die of the plague :D

Besides, as Bart Simpson once said "once the sun burns out we're all done anyway" :D

[pseudobrit]

Only problem with the floppy to DVD is the DVD isn't half as old as the floppy was..the floppy was around for decades when Apple made the move to kill it...the DVD has been out what, 7-8 years?

The 3.5" floppy was not around for decades. The 3.5" floppy shipped with the 128k Mac and was a novelty then, in 1984. In another few years, it became more commonplace. The iMac shipped floppy-less in 1997.

When DVD debuted (in 1995; it was widepread by 2000), HD standards were on the horizon, so its time was limited from the beginning. ATSC published the final standards that year. HDTVs make DVDs obsolete.

DVD was better than VHS because of the form factor. No rewind, instant skip, multiple subtitle options, bonus features, smaller, lighter, etc. But it's not capacious enough to make use of HDTVs. 720x480 is just awful looking on a 1080 set.

HDTV will be around for over a decade. It probably won't be replaced anytime soon; its adoption had to be legislated and 4K TV broadcasting will be a hard sell even ten years from now. I don't think the US has enough cable bandwidth for it.

Standard definition TV's long life could be seen as an example of how the wider market naturally finds the lowest common denominator to its detriment. If it weren't for the legislation, we'd probably have very limited HDTV broadcasting available.

[iW00t]

I would much rather enjoy the decline of the world on a 50" LCD TV than using candles to light my house while waiting to die of the plague :D

Besides, as Bart Simpson once said "once the sun burns out we're all done anyway" :D

Well since it is still billions of years from now I think there are better odds of mankind dying due to "man made" causes.

Or if we somehow evolved into enlightened beings in the future I don't see why we can't build like a few Battlestars to leave this dust ball behind :)

[jdechko]

I would much rather enjoy the decline of the world on a 50" LCD TV than using candles to light my house while waiting to die of the plague :D

Besides, as Bart Simpson once said "once the sun burns out we're all done anyway" :D

Oh, me too. But I'd like to consider myself smarter than "people as a whole". A lot of the time I know what I need or what I'm looking for. Then there are times where a company has to compete to draw me to their product. Other times, I look at something and have to have it, though I never needed it before I knew it existed. :)

Sometimes I think this whole forum is that way... just look at what happens keynote day and shortly thereafter. You'll see what I mean. ;) Fortunately, most of us are usually level-headed and only are affected by the Jobs RDF 1 or 2 times a year.

[LethalWolfe]

The 3.5" floppy was not around for decades. The 3.5" floppy shipped with the 128k Mac and was a novelty then, in 1984. In another few years, it became more commonplace. The iMac shipped floppy-less in 1997.

When DVD debuted (in 1995; it was widepread by 2000), HD standards were on the horizon, so its time was limited from the beginning. ATSC published the final standards that year. HDTVs make DVDs obsolete.

DVD was better than VHS because of the form factor. No rewind, instant skip, multiple subtitle options, bonus features, smaller, lighter, etc. But it's not capacious enough to make use of HDTVs. 720x480 is just awful looking on a 1080 set.

HDTV will be around for over a decade. It probably won't be replaced anytime soon; its adoption had to be legislated and 4K TV broadcasting will be a hard sell even ten years from now. I don't think the US has enough cable bandwidth for it.

Standard definition TV's long life could be seen as an example of how the wider market naturally finds the lowest common denominator to its detriment. If it weren't for the legislation, we'd probably have very limited HDTV broadcasting available.

The only thing I'll nitpick here is the gov mandate was a move to digital b'casting, not HD. The industry made HD the de-facto digital standard though.

I will agree that I don't see HDTV getting "upgraded" anytime soon.


Lethal

[Haoshiro]

You think the numbers have shifted all that much? I'd still believe MS makes nearly all their money on the OS licenses and Office. Not much has changed, really. The console market is relatively small in the grand scheme of things.

You saw the MWSF '07 keynote, yes?

Considering revenue changes from year to year, and that if an increase in profits were going to happen it would obviously be seen at some point.... sure I think it's possible it could have "shifted all that much".

It might not have, but 4 years is enough to do it. Heck, it could have happened in 2003. Like I said, the shift from not making profit to making profit would occur at some moment in time, so it could be any year.

[LethalWolfe]

Considering revenue changes from year to year, and that if an increase in profits were going to happen it would obviously be seen at some point.... sure I think it's possible it could have "shifted all that much".

It might not have, but 4 years is enough to do it. Heck, it could have happened in 2003. Like I said, the shift from not making profit to making profit would occur at some moment in time, so it could be any year.
If you're so sure your assumption is correct why not post a link supporting it?

Going by data from this Link (http://seattlepi.nwsource.com/business/290188_msftearns27.html) w/o Windows and Office MS is in pretty poor shape (especially if you include their server software under the "Windows" umbrella).


Lethal

[GFLPraxis]

Microsoft lost $4 billion with the Xbox 1. Sony lost $2 billion so far with the PS3.

"OMG nintendo are SEGA and will go away cuz yea" :D

Isn't the Playstation line [usually] Sony's biggest profit maker?

It took Microsoft 4 years to lose 4 billion, and it was a startup.

Sony is the market leader, and has managed to lose 2 billion in six months. Sony wins at losing.

[GFLPraxis]

Only problem with the floppy to DVD is the DVD isn't half as old as the floppy was..the floppy was around for decades when Apple made the move to kill it...the DVD has been out what, 7-8 years?

Yeah, when the floppy died it had been replaced by another format (the CD) that could fit 500 times more and another upcoming format could hold five times that even (DVD).

Now we're talking about killing the DVD because of a format that *just* came out that fits about five times more? No. That's like saying the CD needed to die when DVD came out.

[Haoshiro]

Yeah, when the floppy died it had been replaced by another format (the CD) that could fit 500 times more and another upcoming format could hold five times that even (DVD).

Now we're talking about killing the DVD because of a format that *just* came out that fits about five times more? No. That's like saying the CD needed to die when DVD came out.

Or that floppy should have died when Zip Disks came out (or the superior LS-120).

[SpankyPenzaanz]

We're better off for being forced to march forward down the proper path. You don't give people what they say they want. You give them what they need.

Wasn't that the sentiment in 1930's Germany?

[coffey7]

They cost $600 and they are going to lose money. Losers. How did they sell 210 million ps2's and lose their tails on that also.

[TheBobcat]

Sony got arrogant, just look at their chief's comments regarding the PS3 competition during the development of PS3. Sony had this idea that because they were the leader they could do no wrong and dictate to people what hey wanted, and everyone would love it.

Sony will still have a decent showing with PS3, but IF they end up in the lead it will be a far smaller margin than it was for the PSX and PS2, in non-Japanese markets.

Oh, and the Wii is probably a fad. It's success is because it was the more available and cheaper. I see it more as being a second console for most people combined with a PS3 or X360.

[GFLPraxis]

They cost $600 and they are going to lose money. Losers. How did they sell 210 million ps2's and lose their tails on that also.

I think you got the numbers reversed; PS2 sold almost 120 million, and was profitable.

[GFLPraxis]

Oh, and the Wii is probably a fad. It's success is because it was the more available and cheaper. I see it more as being a second console for most people combined with a PS3 or X360.

More available than the XBox 360? Wii's have been and are still sold out *everywhere*, while the XBox 360 has been overshipped and have pyramids of them in Best Buy. Most people aren't going to spend the time searching for a Wii just to save $50.

It'll be a second console, but that was Nintendo's goal. If everyone who buys a 360 also buys a Wii, and everyone who buys a PS3 also buys a Wii, Nintendo wins.

[greatdevourer]

I think you got the numbers reversed; PS2 sold almost 120 million, and was profitable. The PS2 sold nothing like 120 million. May have shipped that, but not sold anything like it

[zero2dash]

Do you think we'd still see Adobe products on the Mac if Photoshop were easy to steal on the platform?

One doesn't have anything to do with the other.
Photoshop is probably one of the most pirated pieces of software for Windows, and yet...Adobe continues to release Photoshop for Windows every product cycle, don't they? People download torrents every day of Mac software, including Adobe stuff.

On topic: Sony has a double edged sword with BluRay. It either wins huge or fails huge; there is no gray area in the Ps3. They lose money now, sure, but we all know (or you all should know) that the money on consoles is made in the software...if they lose $100 billion on Ps3 hardware but make $200 billion in BluRay sales, they come out smelling like roses and laugh on the way to the bank with $100 billion in their pockets.

[GFLPraxis]

The PS2 sold nothing like 120 million. May have shipped that, but not sold anything like it


Sony raised this week its full year shipment target for PS2 to 13 million units from 11 million units previously announced.

PS2 is clearly the holder of all-times record: more than 103 million consoles sold by the end of March 2006. So Sony will sell by the end of March 2007 a total of 116 million PS2 consoles, an impressive achievement for everyone.

Estimated to ship 116 million PS2's. Sony actually sells most PS2s though; you never see pyramids of them.

[zero2dash]

Sony actually sells most PS2s though; you never see pyramids of them.

I bought one (again) on Friday.
But it was used though, so I didn't add to their numbers. :p :D

[jiggie2g]

This is great news, I am glad to hear that $ony is now going to feel the pain for trying to force another propriety format down our throats. PSP was a flop they just need to cut their losses with that and move on. Sony's biggest mistake with the PS3 was the inclusion of Blu-Ray. They completely misjudged the market and hoped people would be wowed by their HD format. but these are different times now.

In 2000 when PS2 made it's debut DVD was a Single Standard format on the rise that already had 3yrs in the market under it's belt. DVD Players at this time were at the $200 mark and many people felt that they were just getting a New Gen console for an extra $99. Fast Forward to 2006, DVD has become the De facto standard for all Video. DVD works on everything, computers, , car and portables players, consoles, top set players and can be viewed on any kind of display.

Now Blu-Ray, while a very promising format it is not in the same position as DVD was back in 2000. This would have been very much like if Sony had released the PS1 with a DVD player back in 1997, it would have been a disaster for Sony. To make matters worse for Sony Blu-Ray is not the only format in the market as HD-DVD is also competing for market dominance. aside from this is also the Video format the movies are displayed in. 1080i or 1080P / High bit-rate MPEG2 vs. H.264 vs. VC-1 , 1 layer DRM for HD-DVD vs 2 layer DRM for Blu-Ray, it's all one big mess.

To add to the fact HD is still not ready for Prime Time, Market Penetration is not there as of yet, analog broadcast and TV's still out number digital by a wide margin. no cable or satellite provider will have full 1080P capacity till 2009 or 2010. 1080P displays are still well over $1000. The RSX aka Geforce 7950GT GPU that powers the PS3 cannot display 1080P games at 60FPS with AA/AF turned on nor Display AA w/HDR. so all of this is meaningless.

I'm afraid when Sony developed the PS3 they were actually thinking PS4, and are now playing for that mistake. This is 3DO all over again Folks. Too soon for it's time.

If Sony had just went with a DVD-ROM drive I would have been happy to purchase a PS3 and they would have been in a much better position. I predict they will do just this before 2007 ends.

I personally Do ont understand why M$ and $ony went with such exotic and outlandish hardware designs with this Gen of consoles. Nintendo stood with 5yr old hardware and can't even keep Wii's in any store more then 30 mins before selling out.

This would have been my Perfect Console:

Intel Core 2 Duo @1.86ghz Or Athlon X2 4200+@2.2ghz
512MB 667mhz DDR2
Slot load DVD-ROM
Geforce 7600GT w/256MB GDDR3 or Radeon X1900GT w/256MB GDDR3
3.5 inch 80GB SATA HD
Customized Linux OS
802.11b + BT 2.0 EDR

Basically a Mac Mini on Steroids. without the crazy Apple markup.

This would have been plenty just for games. existing hardware that is already sold in volumes would have amounted to a much cheaper console. minis all the heating problems and other firmware crap. M$ did this with Xbox 1 and it worked like a charm don;t know whey they changed suit.

[GFLPraxis]

This would have been plenty just for games. existing hardware that is already sold in volumes would have amounted to a much cheaper console. minis all the heating problems and other firmware crap. M$ did this with Xbox 1 and it worked like a charm don;t know whey they changed suit.

Not true at all. Designing the custom hardware allows them to emphasize on hardware aspects necessary for gaming and tone down what isn't.

The XBox 1 did NOT work like a charm. The system was physically around three times larger than the GameCube, and cost over twice as much to build (GameCube was sold at $200 for a profit; XBox sold at $300 for a $100 loss, a year later), but was not *significantly* more powerful (at 2x the build cost and 3x the size you'd expect a much more powerful machine, but the GameCube was arguably more powerful processor wise and the XBox had a slightly better GPU).

Microsoft took a $4 billion loss.

The XBox 360 was the smart way of doing it. So was the GameCube. The PS3 is the stupid way of doing it (both GameCube and XBox 360 were based off existing PowerPC hardware, just modified and tweaked. PS3 was so radically different it upped development costs and cost billions in R&D).

[e²Studios]

.....<nonsenserantaboutpassingopinionsasfacts>

I think that you have no real knowledge of how things work, especially the gaming and entertainment industry.

BD is not a proprietary format any more than HD DVD or DVD is. Sony does NOT own or control the BDA with the expection of being on its Board of Directors.. Apple is on that same board.

You basically spent a lot of time venting on why you hate Sony for doing things that you dont like or maybe that you just can't afford. I'm not sure how to translate your rant, it doenst make much logical sense though. It sure as hell has no facts to back any of it up either.

Sony is a multi-billion dollar corporation, losing 2 billion on a product that will more than likely make them profits in the future isnt much more than a prick of the finger to them. SCEE SCEA SCE is Sony's most profitable division, even with the loss it's probably nothing compared to what the PS2 brought in profit wise. It takes money to lose money, without risk there is no reward but i think the PS3 is far less of a risk than most would like to think it is.

As for the Wii, Nintendo is doing a horrible job of getting consoles in to consumers hands, they are creating the demand with their piss poor handling of getting Wii's to the end consumer. Nintendo is lucky that the media gave them a free ticket on the media hype otherwise it would put them in a pretty bad spot. The Wii's novelty will wear off in my opinion, itll just take time for the hype to die like most anything else the media overblows.

Ed

[GFLPraxis]

I think that you have no real knowledge of how things work, especially the gaming and entertainment industry.

BD is not a proprietary format any more than HD DVD or DVD is. Sony does NOT own or control the BDA with the expection of being on its Board of Directors.. Apple is on that same board.

You basically spent a lot of time venting on why you hate Sony for doing things that you dont like or maybe that you just can't afford. I'm not sure how to translate your rant, it doenst make much logical sense though. It sure as hell has no facts to back any of it up either.

Ed


He's wrong about Blu-ray being proprietary, and the bit I pointed out...but the rest of the post is correct. The parts about HD not being ready for prime time, market penetration, competing DRM and video file formats, etc etc, are all true.

Dismissing it as a rant is being too lazy to refute it.

[e²Studios]

..The parts about HD not being ready for prime time, market penetration, competing DRM and video file formats, etc etc, are all true.

Dismissing it as a rant is being too lazy to refute it.

I tend to disagree, the market is ready for HD. I can probably find equal amounts of data that show consumer adpoption of HD is up as you can to negate it, right now its his opinion but people seem to like to state their opinions as fact. It's his opinion and i disagree with it, i just have a issue when people try to pass their opinion as a fact and have 0 backing to even attempt to prove it.

Ed