All purpose sales and sales rumors/anecdotes thread next gen+

[Dave Baumann]

MS have evidently already shifted the price of XBOX One in China following PS4's announcement:

http://www.gamesindustry.biz/articles/2014-12-15-xbox-one-gets-price-cut-in-china

 

[Deleted member 13524]

I sure hope so. I dont see any signs. Have they announced something or is it a gut feeling?

There are lots of signs from this last year:
- Vaio division was sold to increase focus (also, money)
- Remote Play on PS Vita, PS TV and Xperia smartphones/tablets
- Playstation Now being available for PS Vita, PS TV, PS3, PS4 and Bravia TVs
- One Sony Entertainment account for all content (Music, Series, Movies, Videogames)
- One PS Plus subscription for Vita, PS TV, PS4 and PS3
- Cross-buy titles between Vita/TV, PS4 and PS3 consoles
- Cross-save in some titles between Vita/TV, PS4 and PS3
- Sony Entertainment streaming services (Video/Music Unlimited) being available to PS Vita, PS TV, PS3, PS4, Bravia TVs and Xperia devices
- BIONZ chips from higher-end cameras going into Xperia smartphones


The "One Sony" strategy was presented in mid 2012.
After 2 years, you can see there's a lot of synergy going on between different components of Sony that were previously isolated from each other.
Entertainment services, Smartphones/Tablets, gaming consoles and Bravia TVs are now sharing a lot more than they did 2 years ago (which was almost nothing).

BTW, I think if Sony gets a BIONZ-X chip into Xperia Z4, they'll pretty much "win" all video quality comparisons throughout 2015.

 

[Shifty Geezer]

Certainly a cut, but I've not seen any report on what their (or Microsoft's) percentage is. I recall reading a post here (perhaps by you) which broke down the average $60 retail disc cost and I don't recall the retail involvement being anywhere like 30%.

It's not on disk games, but I'm confident their cut is higher on digital distribution. I'm pretty sure my friend spoke of 30% cuts. I'll sound see if I can sound them out. But certainly there's a %age involved in PSN sales.

I was thinking more PPV apps like HBO, Sky, sporting events and so on, rather than content directly available from Apple/Sony/Microsoft acting in a traditional distributor/retailer role.

Does Apple get a cut from PPV sales?! That side of thing has always been a mystery. eg. Do the console companies get money from Netflix for its use on their system, or do they pay Netflix for the privilege of having that functionality, or do they operate independently?

 

[Shifty Geezer]

- Remote Play on PS Vita, PS TV and Xperia smartphones/tablets

Yet limiting it to Sony devices smacks of Sony stupidity and management failure. Especially considering hacks get it working on non-Sony devices. If I'm not going to feel the benefit of One Sony until I've bought a Sony TV and a Sony smartphone to go with my Sony console and handheld, the entry price is stupidly high. Whereas if I could use Sony with everything, build up a library and rapport with Sony, when I go looking for a new device, synergy with those services will make Sony devices a little more attractive.

 

[eastmen]

Apple gets a cut of anything sold through an app on their store. I remember B&B and Amazon being upset with Apple for trying to get money on each book sale through the apps on apple devices so much so that for awhile (and it might still be the case) that you couldn't buy books on the apps instead you would have to go to their websites and buy the books and then they would show up in your app.

 

[Phil]

The problem of Sony is they can't focus because they are into so many field at the same time. The interest of Sony Pictures and the interest of SCE or other electronic products aren't the same, worst sometimes interest of Son Picture are detrimental to SCE interestet and vice versa.

Which is precisely why they are losing significance as a company. They are acting as independant directionaless companies when they should be uniformed as one under the brandname "Sony" with a clear focus and direction. People want synergy. If you have a strong brandname, it can hold the power to sell other devices you are selling. Apple pretty much demonstrated this with flawless execution over the years; First the ipod, then the iphone, then the ipad and now they are slowly finding a way into the livingroom too, which until recently was pretty exclusive to TV, Hifi and entertainment makers. Lets put it this way - if you are among the millions already owning a Apple device and get the choice between a pretty good Apple TV for your livingroom that will execute and play all the content/apps that you already use on all your other devices --- or a Sony TV that does absolutely none of the above or only in a very limited scope - which will you go for? Initially, many might go with Sony because they have been a proven player for a long time in the business, but their image is slowly detoriating and there are millions of Apple users worldwide. It's the new 'it' brand. Same applies to Google/Android too - who will eventually go after this market soon enough, although arguably, Google might be more keen on being the predominant OS makers for all these devices, leaving it to 3rd party hardware vendors to supply the hardware.


Anyway, the point is; Sony Pictures might be solely focused on what they do best, and so is SCE - and don't get me wrong - they did an absolutely amazing job with the PS4 from a gaming point of view - but as an entertainment device beyond gaming, they are further off the mark than even the PS3 was. And while the PS4 is an absolute terrific device, they are leaving a lot of potential out there for others to grab. What they should be doing is what Apple has been doing all along; Figure out a way to consolidate your content (everything from Sony music to Sony pictures to all their 1st and 2nd party game developers) and find a way to offer them directly through the hardware they are selling - of which there are many; from laptops, Hifi devices to TVs and PlayStations. The PS4 might already do this to a degree through PSN, but it's not good enough nor is it very user friendly. The bad news is; they've already left it too late. With established big hitters like iTunes and Google Playstore, they've already left it too late to establish one of their own. It's funny - if imagine away the Apple name on all their devices and imagine them being from Sony, it would seem the logical step by the company with ties in all these sectors. Yet it isn't - it's Apple, a brand out of the PC sector that has excelled in exactly what they should have done all along. And not only that - they need some cloud interface that allows peoples content to be transferable directly between all their devices - from videos, music, to pictures. They have the gadgets - they even make kickass digital cameras too. Where's the synergy?

They still have a strong foothold in the livingroom with the PlayStation brand that is good for at least 80 million devices per generation and more than that probably if you include all their TVs and Hifis that are in peoples livingrooms - but if they don't start figuring out how to deliever their content directly and smooth, they'll be left visitors to see how Google and Apple will swallow up what's left of their remaining marketshare.

 

[Shifty Geezer]

Apple gets a cut of anything sold through an app on their store...

Yeah, now I think about it. If you use Apple in-app purchasing system, they could certainly take a cut.

 

[eastmen]

http://www.cnet.com/news/apples-30-per-cent-cut-on-ebooks-sees-google-books-vanish-from-app-store/#!

Google Books has disappeared from the App Store as Apple begins to enforce new rules on buying stuff in apps. Google's ebook app has been pulled from Apple's app outlet and other, similar apps have stopped selling books altogether, in response to Apple's plan to take a 30 per cent cut of sales

 

[Deleted member 13524]

Yet limiting it to Sony devices smacks of Sony stupidity and management failure. Especially considering hacks get it working on non-Sony devices. If I'm not going to feel the benefit of One Sony until I've bought a Sony TV and a Sony smartphone to go with my Sony console and handheld, the entry price is stupidly high. Whereas if I could use Sony with everything, build up a library and rapport with Sony, when I go looking for a new device, synergy with those services will make Sony devices a little more attractive.

That's like complaining how AirPlay doesn't work on Windows and Android devices, or how apple doesn't provide itunes for Android.
The point of One Sony is to bring you benefits if you purchase several different Sony devices. It's supposed to compel you to buy an Xperia Z3 instead of a Galaxy S5.
Making it available to all the other Android devices would bring them additional costs in tech support, while downplaying the value of an Xperia smartphone.

It's not stupid. nVidia's game streaming also only works on SHIELD devices (not even other Tegra-powered devices!).
Of course, that's only the software that nVidia is willing to support by themselves. For any other Android device, you also have the reverse-engineered app called Limelight.
nVidia is letting that app exist - like Sony will probably do with the Remote Play substitutes - but they're not willing to spend their own money to support them. It makes sense from a business POV.

 

[Deleted member 11852]

Does Apple get a cut from PPV sales?! That side of thing has always been a mystery. eg.

If revenue happens in their ecosystem yes. Not if you use an app to sign into a subscription concluded outside of the ecosystem. That's why Amazon, at one point, removed the option to buy books from their iOS kindle app. I don't know if they came to terms later.

Do the console companies get money from Netflix for its use on their system, or do they pay Netflix for the privilege of having that functionality, or do they operate independently?

I don't know but I doubt Sony are taking a cut in the same way. Arguably they need the support more than the service provider need their custom. More so important in the early days of new hardware where install bases are low and death em separation is something that gets focus.

 

[dobwal]

Can someone relay some of their knowledge or links of why they believe Sony or MS aren't receiving a cut similar to Apple?

Given that the licensing fee and retailer's cut are essentially collected by MS/Sony at the point of sale, the burden of distribution costs are moved from the pubs to MS/Sony and the cost saved from not having to physically produce DD titles, I am hard pressed to believe that MS/Sony don't receive a cut similar to Apple.

And Netflix tends to pay distribution costs to hardware platforms that service its app. And given that consoles are some of, if not the most popular platforms for Netflix subscribers, there is a high probability that Sony and MS have pretty good distribution deals with Netflix.

 

[Deleted member 11852]

Can someone relay some of their knowledge or links of why they believe Sony or MS aren't receiving a cut similar to Apple?

Here's a 2010 breakdown from the L.A. Times (be aware this was the paper who announced the Nintendo PlayStation 4 so gaming may not be their thing) but the breakdown is attributed to OnLive:

This is retail so the distribution of profit may (and probably is) very different for different games with both parties sharing profit from lack of distribution and returns, which is actually quote high There's the $7 platform royalty (I think I said $8 in an earlier post) with the retailer margin being $15.

Even assuming Sony were (and they won't be) taking the retailer margin ($15), returns ($7), distribution ($4) and the platform royalty ($7) for a total of $33 for a $60 digital game, there is still all of their overheads. Console R&D, manufacturing, mishaps, distribution, stocking, storage, running studios (probably at a loss in many cases), layers of management and HR, marketing. The list of costs and overheads goes on and on.

Sorry to bang on about revenue being a useless metric, but even if Sony's revenue is high, actual profits based on Sony's figures are low.

 

[dobwal]

Here's a 2010 breakdown from the L.A....

Maybe our wires are getting crossed. I am referring to digital sales from the XB and PS store.

Even if Sony took the retailer's cut and licensing fee from each title, it would mean Sony collecting a 36% cut. Now account for returns (which I interpret as return of unsold goods), distribution and costs of goods. There is no physical costs of goods for a digital sale and distribution costs are something incurred by Sony and MS not pubs when it comes to digital sales. Also, there is no such thing as returns of unsold goods and costs regarding replacement of a defective title amounts to pennies for a re download versus dollars to replace a physical disc (1 sale equals the cost of two packaged titles).

Based on the graph you posted, Sony and MS could claim up to 55% of a digital sale and return a similar level of reveune to pubs as a physical sale. If Sony/MS collected the royalty fee, retailer fee and a distribution fee, they could easily claim more than 30% of the sale and still make a digital sale more profitable than physical sale for pubs.

 

[Deleted member 13524]

I wouldn't trust that pie chart even a bit.
The research was made by OnLive, who was promoting their own streaming service against retailer distribution back in 2008.
There's no info on how, where and when they achieved those proportions. There's just this article from LA Times.

 

[dobwal]

I wouldn't trust that pie chart even a bit.
The research was made by OnLive, who was promoting their own streaming service against retailer distribution back in 2008.
There's no info on how, where and when they achieved those proportions. There's just this article from LA Times.

The slide came from an Onlive presentation during a D.I.C.E summit. It contains no references for those figures, but I doubt Onlive would intentionally present a bunch of made up or significantly wrong numbers to a crowd that would include participants who have intimate knowledge of such figures.

 

[Jwm]

Here's a 2010 breakdown from the L.A. Times (be aware this was the paper who announced the Nintendo PlayStation 4 so gaming may not be their thing) but the breakdown is attributed to OnLive:

This is retail so the distribution of profit may (and probably is) very different for different games with both parties sharing profit from lack of distribution and returns, which is actually quote high There's the $7 platform royalty (I think I said $8 in an earlier post) with the retailer margin being $15.

Even assuming Sony were (and they won't be) taking the retailer margin ($15), returns ($7), distribution ($4) and the platform royalty ($7) for a total of $33 for a $60 digital game, there is still all of their overheads. Console R&D, manufacturing, mishaps, distribution, stocking, storage, running studios (probably at a loss in many cases), layers of management and HR, marketing. The list of costs and overheads goes on and on.

Sorry to bang on about revenue being a useless metric, but even if Sony's revenue is high, actual profits based on Sony's figures are low.

I can only add that my margin as a small brick and mortar store was $5 to $7 on PS3/360/Wii games - if I met the free shipping threshold. So a retail game was $54.99 to $52.99 my cost.

 

[bgroovy]

Can someone relay some of their knowledge or links of why they believe Sony or MS aren't receiving a cut similar to Apple?

Given that the licensing fee and retailer's cut are essentially collected by MS/Sony at the point of sale, the burden of distribution costs are moved from the pubs to MS/Sony and the cost saved from not having to physically produce DD titles, I am hard pressed to believe that MS/Sony don't receive a cut similar to Apple.

And Netflix tends to pay distribution costs to hardware platforms that service its app. And given that consoles are some of, if not the most popular platforms for Netflix subscribers, there is a high probability that Sony and MS have pretty good distribution deals with Netflix.

The 70/30 split is industry standard across PSN, Xbox Live, Google Play, Amazon App Store, Steam and iTunes.

 

[AzBat]

Jwm should be able to confirm, but the percentage on XBLIG was 30%. I wouldn't be surprised if it was the industry norm.

Tommy McClain

 

[Jwm]

Jwm should be able to confirm, but the percentage on XBLIG was 30%. I wouldn't be surprised if it was the industry norm.

Tommy McClain

Yes, as is my WinPhone projects. Would have to look at Win 8, will get back to you on that.

 

[bbot]

PS4 is now selling better than Xbox One at Amazon. Now, you get a free game of your choice when you purchase a PS4 for $399.