Sony Still Losing Money on PS3

[Logan Westbrook]

Sony Still Losing Money on PS3

Sony is making a loss on all PlayStation 3 consoles it sells, according to a market research firm.

In a recent report from market research and consulting firm iSuppli, Sony is still losing nearly $40 on each PS3 it sells. According to the report, Sony has managed to reduce manufacturing costs to just $336.27, but the $100 dollar reduction in price means that the company is still taking a $37.27 hit on each one.

"Since the introduction of the PlayStation 3 in late 2006, Sony has subsidized the price of every console sold, a deficit the company has made up for with game sales and royalties," said Andrew Rassweiler, director and principle analyst for iSuppli.

"However, with each new revision of the game console hardware, Sony has aggressively designed out costs to reach the hardware and manufacturing breakeven point as quickly as possible ... in light of these factors, the PlayStation 3 probably is already at or near the tipping point for profitability."

This time last year, Sony was making a nearly $50 loss on the PS3, and according to iSuppli, material costs are likely to reduce significantly in 2010.

Source: IGN [http://uk.ps3.ign.com/articles/105/1054736p1.html]


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[VitusPrime]

Surely one would cut there losses by now and bin the ps?
Then other consoles can get some of there good games ^^
Well we learn with great power comes a big price tag...

 

[Pilot Bush]

it seems sony may go the way of sega...or the PS4 will be much less state-of-the-art

 

[DeadlyYellow]

Well thats... dedication I guess. I wonder if Microsoft ever continually lost money on their 360.

 

[Iron Mal]

Let this be a lesson, just because your toy is the shiniest it doesn't mean that it's the best (it's still pretty damn shiney though).

 

[Jared]

Let this be a lesson, just because your toy is the shiniest it doesn't mean that it's the best (it's still pretty damn shiney though).

Yeah, Even though it is a monolith of destruction, it still, cant pull in the peeps

 

[Blimey]

Oh PS3...we had such high hopes for you after the PS2. Alas, our love was not to be. Now you sleep with another, leaving us in the cold. Damn you.

In all seriousness, that is too bad. I will be very impressed if Sony can pull themselves out of this slump. The PS3 isn't a bad console, but was very overpriced when it came out. Now that its down to a reasonable price, most gamers don't care. If it had better exclusive titles then I would be more interested. But its not like the poor performance of the PS3 is the herald of doom for Sony. Remember, they do alot more then game consoles. They have an entire electronics industry built around them, with cameras, TV's, computer monitors, etc. So its not like they are going under or anything. Its just their gaming division that's suffering abit right now.

 

[Syphonz]

how is this news?

 

[demoman_chaos]

It is amusing that everyone is bashing the PS3 and are missing the point.
The PS3 is still being produced despite Sony taking a loss on everyone. Meaning that the PS3 has to be doing well enough in console and game sales to make up the loss.
Would Microsoft continue to put out a console for less than it costs to make it?

 

[JWAN]

I love it. Maybe its just because I think I know the worst SONY fanboy ever spawned, but its also because my economics background helped me arrive at this conclusion about a year before this article.

 

[Terramax]

Let this be a lesson, just because your toy is the shiniest it doesn't mean that it's the best (it's still pretty damn shiney though).

I don't get what you're trying to say? Are you saying the PS3 is a bad console because they're making a loss with each one they sell? Is this another pro 360 rant in disguise?

 

[JWAN]

Well thats... dedication I guess. I wonder if Microsoft ever continually lost money on their 360.

They lost profits for awhile (they still might be loosing profits yet) But by leaps and bounds the PS3 is the farthest one in the tank.

 

[enzilewulf]

Well then this war will eventully come down to Microsoft and Nintendo. Maybe the new Final Fantasys will start to help them get out of that unfortunate slump. Honosty though I really do plan on getting a Ps3. Anyways, Nintendo will always appeal to little kids and mario lovers like me (even though I have a 360 wich I love). But this war will mainly come down to Microsoft and Nintendo.

 

[Casual Shinji]

Damn.

Playstation bashing rears it's ugly head once more.

 

[Kollega]

Oh my. Sony tried to jump higher than their head with PS3. And they succeeded - but they broke both legs in process. PS3 performed in the console race/war/what have you rather poorly up untill recently - but considering that PS2 performed extraordinarily well in last generation, this is a failure. Failure to do just as well, that is.

 

[JWAN]

Let this be a lesson, just because your toy is the shiniest it doesn't mean that it's the best (it's still pretty damn shiney though).

I don't get what you're trying to say? Are you saying the PS3 is a bad console because they're making a loss with each one they sell? Is this another pro 360 rant in disguise?

No, that's logic. Just because your system is shiny, and you have a large following of fanboys does not mean you can raise the price to some ridiculous amount and drip in big name titles at a snails pace. Even the fanboys know its a shit deal. (most of them)

 

[Casual Shinji]

Let this be a lesson, just because your toy is the shiniest it doesn't mean that it's the best (it's still pretty damn shiney though).

I don't get what you're trying to say? Are you saying the PS3 is a bad console because they're making a loss with each one they sell? Is this another pro 360 rant in disguise?

No, that's logic. Just because your system is shiny, and you have a large following of fanboys does not mean you can raise the price to some ridiculous amount and drip in big name titles at a snails pace. Even the fanboys know its a shit deal. (most of them)

Are you talking about the Wii?

 

[Xanadu84]

Wait a minute..don't all consoles except the Wii lose money on each console sold? And even the Wii makes only a very small profit? Ive always heard that all consoles lose money on each console sold, and make there entire profit on games. Maybe i'm wrong, but I thought that this was par for the course.

 

[BaldursBananaSoap]

Wow PS3 bashing is abundant in this one...

This is probably because Sony doesn't sell you a bare bones console which needs you to go and buy extremely overpriced add-ons and pay for an online service with awful P2P servers, ads and twelve year olds.

At least they've made up for it in software sales.

 

[Asehujiko]

Surely one would cut there losses by now and bin the ps?
Then other consoles can get some of there good games ^^
Well we learn with great power comes a big price tag...

What great power? It's RAM is outdated by 2001 standards, the GPU was mid range in 2004 and the CPU only looks good until you realize it doesn't support multithreading and 5 of the cores are only there to look pretty on the fact sheets so it ends up being a P4 with an inflated ego.