A problem with PS3's 2 SKUs

[Sis]

I thought about that too.

Depends on the mix Sony's expecting. If they expect 80% of sales will be for the $600 SKU, they would make more money by keeping pricing as is and capturing the 20% who otherwise wouldn't have paid more than $500.

If they expect 50/50, then $549 would get them the same results.

They probably believe in the first scenario, that there are a lot of people willing to pay $600 so they might as well get that $600.

I think you're right about this but there's a problem with it. $500 dollars is not cheap, but I was willing to pay that to get a PS3. Psychologically, there is absolutely no way I am paying $600. And in fact, I really don't need the extras that come in the $600 SKU. So here's the (admittedly) odd part of my thinking: I refuse to pay $500 dollars for the "cheap" console because for $500 dollars I feel I should get the best. And yet, I refuse to spend $600...

Am I alone in this thinking? Possibly, but I don't believe so. I think Sony took the worst aspect of Microsoft's 2-SKU plan without addressing what Microsoft's 2-SKU's positive aspect was, namely, getting a console under $300 dollars. As well, the two Xbox 360 products are different enough that the value proposition is obvious. At least, in my opinion.

So to answer the grandparent post: Yes, I think I would have preferred one SKU, regardless of price, but preferrably if they could get it under $500. (But this is admittedly childish reasoning on my part: "I want it so they should just do it".)

 

[expletive]

I think you're right about this but there's a problem with it. $500 dollars is not cheap, but I was willing to pay that to get a PS3. Psychologically, there is absolutely no way I am paying $600. And in fact, I really don't need the extras that come in the $600 SKU. So here's the (admittedly) odd part of my thinking: I refuse to pay $500 dollars for the "cheap" console because for $500 dollars I feel I should get the best. And yet, I refuse to spend $600...

Am I alone in this thinking? Possibly, but I don't believe so. I think Sony took the worst aspect of Microsoft's 2-SKU plan without addressing what Microsoft's 2-SKU's positive aspect was, namely, getting a console under $300 dollars. As well, the two Xbox 360 products are different enough that the value proposition is obvious. At least, in my opinion.

So to answer the grandparent post: Yes, I think I would have preferred one SKU, regardless of price, but preferrably if they could get it under $500. (But this is admittedly childish reasoning on my part: "I want it so they should just do it".)

Well Sony has painted you (and me) into this corner though by building up HDMI (or DUAL HDMI even) and all the other removed features to the point where they were perceived as differentiators and 'must haves' this generation. When you read the media reactions, most of them are calling the PS3 $600, not $500, because theyve been convinced that HDMI is intrinsic to what the PS3 'experience' was supposed to be. In the end, $500 should get me the PS3 experience theyve been selling me for the last 16 months.

The solution for Sony is to bite the bullet and put HDMI on the $500 unit, problem solved. People dont seem to care about no wifi or CF slot on the 360 and they wont miss it here either.

There some confusion over the cost of HDMI though with prices ranging from $5 to $12, either way its a solution that will cost them hundreds of million of dollars over the next 5 years.

Here's the problem with that (for Sony anyway), Sony WANTS people to buy the $600 unit cause theyre clearly losing less on that unit and they figured by taking out HDMI that would drive 60G sales.

They tried to pull off a 2 SKU model like MS but made the big mistake of the 20G never being upgradeable to the 60G so people buying the 20G end up feeling that they paid more money for something that would provide a suboptimal PS3 experience.

Doesnt the Core seem like an absolute steal now? Funny how it took Sony to point that out to everyone.

 

[NavNucST3]

Well Sony has painted you (and me) into this corner though by building up HDMI (or DUAL HDMI even) and all the other removed features to the point where they were perceived as differentiators and 'must haves' this generation. When you read the media reactions, most of them are calling the PS3 $600, not $500, because theyve been convinced that HDMI is intrinsic to what the PS3 'experience' was supposed to be. In the end, $500 should get me the PS3 experience theyve been selling me for the last 16 months.

The solution for Sony is to bite the bullet and put HDMI on the $500 unit, problem solved. People dont seem to care about no wifi or CF slot on the 360 and they wont miss it here either.

There some confusion over the cost of HDMI though with prices ranging from $5 to $12, either way its a solution that will cost them hundreds of million of dollars over the next 5 years.

Here's the problem with that (for Sony anyway), Sony WANTS people to buy the $600 unit cause theyre clearly losing less on that unit and they figured by taking out HDMI that would drive 60G sales.

They tried to pull off a 2 SKU model like MS but made the big mistake of the 20G never being upgradeable to the 60G so people buying the 20G end up feeling that they paid more money for something that would provide a suboptimal PS3 experience.

Doesnt the Core seem like an absolute steal now? Funny how it took Sony to point that out to everyone.

For "us" sissy and ex, our biggest problem is that we already own the 360, and after seeing these prices, I believe it makes it more difficult to justify adding the PS3 as our second console (or in my case third).

EDIT: Especially when we consider what games for the 360 will be available at that time, sucking up more of our money. I don't really feel like spending another $1400 (PS3 and games + 360 games) this November like I did last Nov. Also, I want to see some game pricing first- and third-party, because the console price is not what gets you in the long run its the games.

 

[expletive]

For "us" sissy and ex, our biggest problem is that we already own the 360, and after seeing these prices, I believe it makes it more difficult to justify adding the PS3 as our second console (or in my case third).

Yep, i'd have to buy the $600 unit at launch and with a couple of games and a 2nd controller, thats $800. Are there going to be 2 games at launch that would be worth $400 each to play? I mean Sony has me, the ultimate early adopter, second guessing this. Its insanity i tell you!

Conversely i can take that same money, buy a Wii, a few Wii games, and every 360 game this holiday season that i want...

 

[Powderkeg]

Here's the problem with that (for Sony anyway), Sony WANTS people to buy the $600 unit cause theyre clearly losing less on that unit and they figured by taking out HDMI that would drive 60G sales.

And that's the biggest difference between Sony and MS with their 2 SKU strategies. Sony wants you to buy the expensive one since they make the most money on it. MS wants you to buy their cheap SKU because they'll make the most money in accessories sales. The premium 360 SKU is actually a better deal for the consumer than it is for MS.

 

[onanie]

Well Sony has painted you (and me) into this corner though by building up HDMI (or DUAL HDMI even) and all the other removed features to the point where they were perceived as differentiators and 'must haves' this generation. When you read the media reactions, most of them are calling the PS3 $600, not $500, because theyve been convinced that HDMI is intrinsic to what the PS3 'experience' was supposed to be. In the end, $500 should get me the PS3 experience theyve been selling me for the last 16 months.

HDMI isn't the only "differentiator" this generation (although you'd probably never see it that way). Most of the respectable media is reporting the PS3 as $499 and $599 (don't know what you're reading). If anyone is convinced that HDMI is intrinsic to HD gaming experience, Microsoft certainly isn't Really, no one is stopping you from buying the $500 if you prefer. It should be obvious that features stripped from the "gaming only" SKU won't be missed (as i mentioned before, HDMI is basically about digital signal protection, while the analog outputs are as capable at Hidef as those on the 360, which I'm sure didn't disappoint you).

Here's the problem with that (for Sony anyway), Sony WANTS people to buy the $600 unit cause theyre clearly losing less on that unit and they figured by taking out HDMI that would drive 60G sales.

They tried to pull off a 2 SKU model like MS but made the big mistake of the 20G never being upgradeable to the 60G so people buying the 20G end up feeling that they paid more money for something that would provide a suboptimal PS3 experience.

Doesnt the Core seem like an absolute steal now? Funny how it took Sony to point that out to everyone.

I do not think you can accurately cost the features that have been removed from the cheaper SKU. Multiple memory stick support, wi-fi, HDMI chip, and 60GB HDD? Would be a steal for $100 (compared to what you need to pay as accessories). What sony has done is to give consumers choices, and the few who choose the game only SKU would enjoy identical gaming experience to those who chose the "entertainment system". Compare that with the "Core" - where is the hardisk (and the ensuing problems with load times and downloadable content)? Suboptimal indeed, and so unlike the 2 SKUs available for PS3.

 

[Black Dragon37]

HDMI isn't the only "differentiator" this generation (although you'd probably never see it that way). Most of the respectable media is reporting the PS3 as $499 and $599 (don't know what you're reading). If anyone is convinced that HDMI is intrinsic to HD gaming experience, Microsoft certainly isn't Really, no one is stopping you from buying the $500 if you prefer. It should be obvious that features stripped from the "gaming only" SKU won't be missed (as i mentioned before, HDMI is basically about digital signal protection, while the analog outputs are as capable at Hidef as those on the 360, which I'm sure didn't disappoint you).


I do not think you can accurately cost the features that have been removed from the cheaper SKU. Multiple memory stick support, wi-fi, HDMI chip, and 60GB HDD? Would be a steal for $100 (compared to what you need to pay as accessories). What sony has done is to give consumers choices, and the few who choose the game only SKU would enjoy identical gaming experience to those who chose the "entertainment system". Compare that with the "Core" - where is the hardisk (and the ensuing problems with load times and downloadable content)? Suboptimal indeed, and so unlike the 2 SKUs available for PS3.

Ahh, but another problem...

The Core isn't upgradeable.

Plus Sony did criticise the Xbox 360 for not having an HDMI, and proclaimed that with its aid, the PS3 does "true" HD, which isn't the case now that the HDMI doesn't come as standard.

 

[onanie]

Ahh, but another problem...

The Core isn't upgradeable.

Plus Sony did criticise the Xbox 360 for not having an HDMI, and proclaimed that with its aid, the PS3 does "true" HD, which isn't the case now that the HDMI doesn't come as standard.

From memory, the big point that sony wanted to hammer down was 1080p (which they call true HD) vs 720p for gaming, not necessarily HDMI (for movies). This remains true.

 

[Black Dragon37]

And 1080p is achievable via an HD AV cable?

And I repeat: the Core pack isn't upgradeable. So I don't see the point of buying it... yet, anyway.

 

[onanie]

And 1080p is achievable via an HD AV cable?

And I repeat: the Core pack isn't upgradeable. So I don't see the point of buying it... yet, anyway.

There are 1080p component cables, and certainly HDTV sets that accept 1080p over component. Not sure whose "core pack" you're talking about. If the PS3 game sku, then I'm not sure what needs upgrading compared to the 360 core sku.

http://www.audioholics.com/productreviews/avhardware/westinghouse-LVM-42w2p1.php

 

[Sis]

There are 1080p component cables, and certainly HDTV sets that accept 1080p over component. Not sure whose "core pack" you're talking about. If the PS3 game sku, then I'm not sure what needs upgrading compared to the 360 core sku.

http://www.audioholics.com/productreviews/avhardware/westinghouse-LVM-42w2p1.php

From my understanding, 1080p is not really viable over component except on a handful of TVs. Anyway, the point is moot: Sony removing HDMI from a SKU is a big deal. To suggest anything else is revisionism of the utmost nature; I still remember Sony crowing about not one but two HDMI ports.

Outside of this media and PR hyperbole, I will agree that HDMI is not important, or as important as made out to believe, even with regards to HD movies playback (no ICT movies yet, and possibly/probably by the time they are, HD players will be commodity-priced). Just acknowledge that it was Sony who was trying to make the distinction...

Finally, the problem with the $500 SKU is this (at least from my personal perspective): If I pay more than $200-$300 for a console, I expect the best. Yet I'm unwilling to pay $600 for a console. And still the $500 dollar SKU is not cheap, so it falls in the gray area of "more inexpensive than over expensive, not as good as the best."

In other words, in Consumer Purgatory.

 

[Sis]

For "us" sissy and ex, our biggest problem is that we already own the 360, and after seeing these prices, I believe it makes it more difficult to justify adding the PS3 as our second console (or in my case third).

Totally agree, Nuc. I was actually resigned to buying a launch day unit. But the combination of pricing, SKU features, and lack of rumble on the controller (yes, I went there) has completely turned me off the PS3.

Of course, as soon as the ICO devs show their first game or the next Ratchet and Clank is released, I'm sure I'll cave. But damn you, Sony! Damn you for making it a difficult decision! :smile:

 

[expletive]

Feels more like Consumer Agony doesnt it? The thought of spending almost $850 at launch for 2 games is really killing me.

 

[Sis]

Feels more like Consumer Agony doesnt it? The thought of spending almost $850 at launch for 2 games is really killing me.

Given that I'll probably eventually cave, yeah, Consumer Agony is a more apt description.

 

[Black Dragon37]

Speaking of price, my guess is that the British prices will be between £340-400.

Ironically, I don't think those prices are that bad on my turf.

 

[expletive]

Given that I'll probably eventually cave, yeah, Consumer Agony is a more apt description.

I just hope its a worthy BR player, for me that would ease the pain a bit. If its as gimpy as the last gen consoles were as DVD players, well.... i dont know what i'll do. Probably hold my breath in the corner... and then buy more $80 games.

 

[Sis]

Speaking of price, my guess is that the British prices will be between £340-400.

Ironically, I don't think those prices are that bad on my turf.

This is not the first time I heard that Europe may not flinch at the price. I think Fox5 said it as well, either in this thread or another. It's an incredibly insightful point; Sony may sell very well in Europe just because the price is nothing new yet the value is. North America is, I would predict, very much lost to Microsoft this generation. Japan in my mind is a toss up between Wii and PS3, though I believe in Wii in Japan.

As for the rest of the world, I would have to understand the pricing implications, though my gut says cheaper wins.

 

[onanie]

From my understanding, 1080p is not really viable over component except on a handful of TVs. Anyway, the point is moot: Sony removing HDMI from a SKU is a big deal. To suggest anything else is revisionism of the utmost nature; I still remember Sony crowing about not one but two HDMI ports.

The point is not as moot as you'd like it to be. 1080p over component has never been the issue - component is capable. With an increasing number of consumer displays supporting that resolution (and PC LCD displays already at that level), aren't you selling yourself short with 720p? If you call it "revisionism", then foregoing the HDD as a standard is the more extreme example, if we're talking about gaming. Both companies can be accused of rationalising their costs; at least in Sony's case, it makes more sense to me (and to you too it seems).

Outside of this media and PR hyperbole, I will agree that HDMI is not important, or as important as made out to believe, even with regards to HD movies playback (no ICT movies yet, and possibly/probably by the time they are, HD players will be commodity-priced). Just acknowledge that it was Sony who was trying to make the distinction...

Much of the fuss from Sony is about 1080p vs 720p distinction, not necessarily HDMI. Why are you so upset over this? What HDMI is important for, is next gen movie playback, and it is available for those who want HD movie playback in their game console.

Finally, the problem with the $500 SKU is this (at least from my personal perspective): If I pay more than $200-$300 for a console, I expect the best. Yet I'm unwilling to pay $600 for a console. And still the $500 dollar SKU is not cheap, so it falls in the gray area of "more inexpensive than over expensive, not as good as the best."

In other words, in Consumer Purgatory.

I feel that the price represents the value it holds It isn't only about the physical features, but the games that i've seen.

 

[Sis]

Much of the fuss from Sony is about 1080p vs 720p distinction, not necessarily HDMI. Why are you so upset over this? What HDMI is important for, is next gen movie playback, and it is available for those who want HD movie playback in their game console.

I'm not upset, I just find it humorous that Sony one month can proclaim dominance of next-gen console due to their not only supporting 1080p but having two HDMI outputs, and the next month quietly killing not one, but both HDMI out, on their lower end model. If they were only crowing about 1080p, then please clue me in on all the 1080p games that will be released.

Anyway, I find Sony's PR manuvering and back-peddling as annoying as I do Microsoft's "all 720p + AA" proclamations. But annoyed doesn't equal upset--I just don't like revisionism.

 

[Sis]

I feel that the price represents the value it holds It isn't only about the physical features, but the games that i've seen.

And what value is that? $600 is ok. How about $1000? $2000? I mean, at some point too much is just too much. For me, $400 bordered on "too much", but it had the added benefit of being the first next gen console. Adding two hundred dollars to that price for a system that eventually will give me unique and compelling games is really not that great of a deal, IMO.

The way I look at it is like this: there're consumers who would buy the PS3 at any price--and it sounds like you fall into that category. But that group is very small; think first gen Xbox size. The hardcore Playstation fan. It's a sizable chunk, but Sony must reach the rest of the market, and at their current pricing and SKUs, I don't see that happening. Nor do I yet see how they will achieve that pricing in a timely-enough fashion to fight off Xbox 360 and Wii.