Sony: Price Doesn't Make or Break a Platform

[Tom Goldman]

Sony: Price Doesn't Make or Break a Platform

Sony says that price isn't as important to consumers as the quality of a product.

Before finally NGP [http://www.escapistmagazine.com/news/view/93974-Sony-Reveals-PS3-Slim-Drops-PS3-Prices-to-299] coming in the next year or so, consumers are wondering if the company has learned its lesson, or if the NGP will face the same uncomfortable price structure as the PS3. According to Sony Computer Entertainment of America president Jack Tretton, price just isn't that big of a deal.

Tretton told Fast Company that he feels "consumers respond to value," perhaps in contrast to what was seen with the PS3, which had a lot of value but was still hard for many consumers to get into at price points beyond $399. "If you're passionate about something you find a way to go out and get it and gamers are very passionate," Tretton said.

He continued to say that technology like a gaming platform is an investment that will be used for "many years." Tretton compared the investment to iPods and cellphones, saying: "People are used to spending several hundred dollars to get a portable device."

Tretton's view is that consumers judge a product and its price by how worthy it is, not necessarily by price itself. "It's not to say that the price of the platform isn't a consideration, but I don't think price makes or kills a platform," he added. "Something that's lousy and very inexpensive is not going to be successful. Something that's pricey will ultimately find its audience if there's enough value there."

These comments hint that Sony might have a slightly higher price point in mind for the NGP when it comes out than it'll probably become successful at. claims [http://www.escapistmagazine.com/news/view/108522-Ubisoft-Survey-May-Reveal-Sony-NGP-Price] the device will be affordable. $250 would probably be the NGP's sweet spot, putting it right alongside the Nintendo 3DS, unless the 3DS drops in price by the time the NGP is released.

The idea that price can't make or break a platform feels incorrect though, and Tretton should know first-hand by Sony's experience with the overpriced PSPgo. The digital download-only device launched at $250 and was a failure by Sony's own admission, though the company tried to spin it [http://www.escapistmagazine.com/news/view/101206-Sony-PSPgos-Failure-Was-a-Success] as a success. The PS3 is doing fine for itself now, but I would say a console's price has a lot more weight than Tretton seems to feel it does.

Source: CVG [http://www.fastcompany.com/1744527/jack-tretton-sony-playstation-3-d-gamification]


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[AndyFromMonday]

And that's exactly why Sony kept the price so high on the PS3, right?! RIGHT?! Wait...

 

[Corpse XxX]

I somewhat concur with Sony on this one..
But to a certain degree that is, fanboys will buy whatever brand they have always been following no matter the prize..

But the average non-hardcore consumer will usually buy the cheaper one, and this is a big group of people any company cannot afford to overlook...

In short, fanboys go for brand, everyone else go for prize..

 

[GonzoGamer]

These people just shouldn't talk.

He may as well have just said "the ngp is going to be way overpriced but you people are overcharged for everything else so why should you care?"

Still, it's not the most insulting thing to come from Sony.
Not as bad as "all I want for xmas is a psp."

 

[Lieju]

Well, a lot depends if there's a cheaper alternative. Wii is different, but XBOX360 is pretty much the same as PS3.

 

[Robyrt]

Jack Tretton is required to say this, even if he knows it isn't true, because it's his job.

Of course consumers are price-sensitive. They pay top dollar for Apple products not just because they are high-quality, but because they lead the market, and they have excellent marketing campaigns.

 

[pandasaw]

I have to disagree. I bought the 360 and Wii before the PS3 because they were not as expensive. I eventually bought a PS3 when the price was not in the stratosphere.

 

[gibboss28]

...he's right, it doesn't make or break but it is a major factor.

 

[barbzilla]

I would agree that people will buy it despite the price, but in the essence of success if you want one in every house you have to monitory your price point. This is what Nintendo did and that is also why the Wii is the most widespread user base for any current gen console (despite the lack of games that appeal to every group). I think that if Sony released the NGP at the same price as the 3ds the 3ds would still sell better based on past experience. So I will agree with them on this scenario that price is less important (to a limit nobody is paying $1000 US for this thing).

 

[The Rockerfly]

Yeah you keep telling that *looks at the wii price* yeahhh no

 

[RedEyesBlackGamer]

Lower middle class citizen- "Yes, it does."

 

[SimGrave]

If you look at Apple products... can't help but agree with Mr. Tretton.
Any Apple product is overpriced (IMO) and yet they sell like hot cakes.
One question remains... does Sony have the same avid followers has Apple does?

Another big difference, is that Apple products don't rely on softwares to gain longevity.
Hardware (include OS) alone can do it on it's own.
iPhone is an all around good phone, iPod plays music and music is always going to be made...
and iPad, well, I'm not sure what's the need for the iPad, but it doesn't matter.

Sony on the other hand, needs game publishers to be on board to reach success.
If hardware is too expensive and consumers don't by them in mass, then publishers won't be convinced that they can get profits out of developing for the console.

If NGP is same price as 3DS... I'm sure it'll sell a lot more.
However, it all depends on what you compare it to... 64gb iPod Touch... is 400$ and no one complains.

Out of all the options iPod Touch, NGP and 3DS... I must say that Sony's device is the one I'm the most interested in and I'm not taking anything away from the other.
This is not a comment about the quality of the various products, but one about the price versus consumer habits.

 

[mjc0961]

So, in other words, he's saying that the NGP is going to be super expensive and people will find a way to buy one. It's "people will get a second job to buy a PS3" all over again.

Yeah the price doesn't break a platform.
Sony does that all by itself

Too true.

If you look at Apple products... can't help but agree with Mr. Tretton.
Any Apple product is overpriced (IMO) and yet they sell like hot cakes.
One question remains... does Sony have the same avid followers has Apple does?

As we saw with the PSP Go and the PS3's sales at launch, the answer is no. This logo [http://www.forthemommas.com/wp-content/uploads/2009/11/playstation-logo.jpg] does not have nearly as much power over people's wallets as this logo. [http://blog.crowdspring.com/wp-content/uploads/2008/05/apple-logo.jpg]

 

[CrazyCapnMorgan]

While it's true that price doesn't necessarily make or break a platform, I would think pulling a bait and switch on a feature that was advertised for said platform probably does.

 

[Something Amyss]

Customers do respond to value. They also respond to straight price. Weird.

 

[SithDaddy75]

Wow, this is economics 101 stuff. Yes price matters. It seems almost unfathomable that Sony of all companies still doesn't get it after they priced themselves right into 3rd place in this generation of consoles.

 

[Jaded Scribe]

He raises an interesting point. While of course his position as PR guy means that obviously he's going to spin things for the company, I don't think he's entirely wrong. As another posted stated, look at Apple. People happily pay twice as much or more than equivalent PCs/laptops because they trust the quality of the brand.

While the PS3 was pretty locked in as the 2nd current gen console I wanted (first being the Wii, as I'm a diehard Nintendo fan), what made it really worth it for us was that it had a lot of other capabilities.

My husband wanted a blu-ray player, and most of the ones he was looking at were around $150-$200. He was happy with the one in the PS3, so we saw $400 as a good deal. Instead of saying "Ouch, $400 is awfully pricey for a console", it was "Ok, so we're paying $150 for a blu-ray player, and $250 for a console. That's reasonable." With the added bonus of internet connectivity making things like Netflix easier to use, it felt like a good deal for us.

I know the PS3 has had issues with reliability, but we've never had any problems with ours, and it's not like XBox's Red Ring/Light of Death is a good sign of reliability either.

Considering that gaming is a luxury hobby, I'm willing to spend extra on a product that has quality behind it.

 

[Worr Monger]

SOME people will buy something regardless of price

EVERYONE has their limits.

 

[KeyMaster45]

Yeah the price doesn't break a platform.
Sony does that all by itself

Did anyone else feel that heat cause I think someone just got burned! if(rofl!=9000){cout>>rofl;}

I'm not saying I feel stupid buying a PS3 just to play God of War 3, I'm just saying that I've only got 3 games for it, and two of them are little big planet and it's sequal.

Price matters, especially for a handheld console. The only reason I think the price tag for the 3DS is acceptable is because it's got 3D without the glasses. Sony's new handheld, however, I wouldn't pay of $150 for what amounts to a nicer looking PSP and will probably have the same lack of game selection.