Has anyone noticed the reshuffling of Sony's price/sku arrangement was about the same time Sony released/announced a cheaper standalone Blu-ray player? I think prices will drop in line with the players as not to really screw the other Blu-ray player manufacturers. Especially since it seems the PS3 is the only player that is going to be upgradable to/compliant with the final Blu-ray Profile 1.0 (and BD-Live) come Nov 1.
Ars Technica rumor claims 399 40GB PS3 this year
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Profile 1.1 not BD-LIVE
Profile 2.0 includes BD-LIVE
http://en.wikipedia.org/wiki/Blu-ray_Disc#Profiles
I know. I was saying the the PS3 looks to be most likely to support BD-Live as well as the full spec 1.0 (most commonly called 1.1).
Guild Wars is a much smaller scale with a more limited scope than PSN and has sustained itself through multiple episodic releases. You're talking 3 standalone titles and expansion pack over a period of 2 and half years.
Plus, Im not saying PSN will never make a profit. Im saying in its early stage the revenue generated by PSN is not covering all the on going investment and not just maintenance costs. Look at all the revenue streams PSN is planned to have versus whats its currently offering.
If "hard drive size" and "WiFi antenna" are the only things you think are involved with the manufacturing costs in this case, then it strikes me as a pipe dream that you can provide useful analysis.
Plus, I don't think anyone here has said they HAVE knocked off $200 from the 60GB SKU... we've been saying they really NEED to get lower, and that going back a step from the current 80GB model may not make too much sense.
And PSN is supporting itself with lots of titles released all through the year.
But are those costs being recuperated by charges levied on every PS3, or are those investment costs going to be recovered from the PSN service when it's fully fleshed out? At this point, I don't think PSN is costing PS3 buyers anything. It's perhaps eating into Sony's bank balance, but it'll turn that around (Sony hopes!), not least because the actual costs involved probably aren't that high.
And PSN is supporting itself with lots of titles released all through the year.
A Sony director of PSN operations has stated that the PSN may not always be free, which would leave one to believe that currently PSN represent a cost and isn't guaranteed to be viable profit generator for Sony.
http://www.gamersreports.com/news/5881/sony-says-psn-may-not-always-be-free/
Just what I was saying. Whether or not PSN represents a loss or a profit for Sony at the moment, its performance financially plays a part in the pricing strategy of the PS3.
All revenue streams play a part in how a manufacturer initially prices their consoles and their price reduction strategy over time.
Its my opinion that currently PSN is in infant stage and represents a cost as the current PS3 userbase is not only trying to support the current form of the network but also the future forms of PSN.
That's just a standard "no comment" response, he is not in a position to confirm everything.
IMO download contents will be a secondary revenue source when advertisement revenues kick in. With the web browser, ad banners in Home can work just like any other ads in interweb.
BTW apparently financial analysts are almost certain of Hirai's announcement for a price drop at the TGS keynote, but I guess it'll be Japan only.
I would say that PS HOME will alleviate the PSN costs through advertising.
(and possibly through stocks... but that introduces a whole new financial level of issues and I don't want to go into the details...)
Plus they are integrating PS Home onto PSP and phones... It seems that Sony is taking a shot at part of the market that Google has been struggling to do: advertising via phone market.
Right now PSN does look very much like a marketing thing. It's filled with movie and game trailers and game demos. There was an interesting interview on web 2.0 and gaming on threespeech. Now i have no idea how Youtube or My Space are making money but they do seem to be sustainable.
A price cut is nice but I think Sony need games more than a price drop right now. Their last two big games, Heavenly Sword and Lair, are completely new IPs making them harder to market than, say, Mario, GTA or Halo. Of course more games are coming (I'm looking forward to R&C and GT5) and a price cut on top of that would be gravy.
A price cut is nice but I think Sony need games more than a price drop right now. Their last two big games, Heavenly Sword and Lair, are completely new IPs making them harder to market than, say, Mario, GTA or Halo. Of course more games are coming (I'm looking forward to R&C and GT5
) and a price cut on top of that would be gravy.I'm still not sold on how a smaller capacity hard drive would enable such a dramatic drop - or any drop - but I saw this in an article, and thought of this thread, so..
Hon Hai precision to deliver PS3 consoles to Sony
Just don't read too much into it .. Articles like this can be very misleading.
Hon Hai precision to deliver PS3 consoles to Sony
Just don't read too much into it .. Articles like this can be very misleading.
I agree with Farid. Even if a 40GB drive isn't cheaper, it is perception that is relevant. It is just like the 360 Core--MS makes more money on the Pro version, but the Core is there for accessibility and mindshare purposes. The only real difference is, with a cheaper PS3 SKU, it would sell better than the 360 Core because what makes the PS3 "Pro" better is to be quite frank, worthless to most gamers. At least to their core gaming experience.
I would almost go so far as to say that it is a given that the price of the HDD isn't an important factor (from 40-80 price is probably similar). And if we assume this to be the case, then as the PS3 so far has used the HDD size as an SKU identifier rather than a name, they could be introducting a 40GB version simply because that's the way they've been identifying their SKUs. But the real cost reduction will have nothing to do with the HDD size.
I don't think anyone's left it out, but a $50 difference at that cost level hardly seems worth the inconvenience of split SKU's, for only those minor differences.
You see pricing like this all the time to encourage people to spend that extra $50 they might not normally have wanted to spend. If the price I want to pay is $400, but I can get "so much more" for an extra $50, maybe I'll spend over my budget. It's like soft drinks at the movie theater.
Yes, but they lose out by making it more expensive to manufacture, ship, potentially confuse customers, and irritate the box stores. (And potentially lose some sales when they can't keep the RIGHT kind of stock in... uh... stock.)
I'm asking how the extra $50 (which is actually a lot less, ones you factor other things out) would be better than simply offering the one SKU at $400, and/or a much more identified as "premium" premium SKU.
I can't see them wanting to offer the split SKU's in retail for that little a difference.
I'm asking how the extra $50 (which is actually a lot less, ones you factor other things out) would be better than simply offering the one SKU at $400, and/or a much more identified as "premium" premium SKU.
I can't see them wanting to offer the split SKU's in retail for that little a difference.
A simple strategy would be make say close to 1M 40GB SKUs for the 2007 XMAS alone, however, split this world wide. With the US getting the majority of say about 500k.
Sell it at $399 worldwide, with a free copy of Spiderman 3 BR (this costs Sony almost nothing...well a potential loss in DVD and BR says of Spidy 3, but in the long run it will work out better)
Also, sell the current 80GB SKU at $499 with a free game + Spiderman 3 BR.
$100 for a 40 more gigs and a free game, does seem like a great value.
Now, by realeasing a relatively small number of 500K $399 SKUs for xmas, what that does is create a perception that the PS3 is only $399!!! However, with the limited numbers these thigns will sell out within weeks.
A lot of people will then go the malls and stores with the intention of getting a PS3 for $399, only to be met with a $499 SKU. However, since Sony is throwing in an extra game + double HD space, the percieved value is the same, thus Sony makes the sale no matter.
Sony just needs to create the perception that the PS3 is cheaper....However, the numbers of the $399 SKU shouldn't be soo small that it gets bad press of being unavailable, and it also shouldn't be so mass produced that they lose out of too much sales from the $499 SKU.
I have a good friend who works at Nintendo, and she says they were hearing these $499 rumors weeks before it became big news on the net.
So apparently, this wasn't such a sudden decision. I won't be surprised if this price drop is annonced at TGS along with the realease of the KZ demo.
Perhaps Sony may wait of the Eve of the Halo 3 realease in order to kill some of its hype...who knows.
Sell it at $399 worldwide, with a free copy of Spiderman 3 BR (this costs Sony almost nothing...well a potential loss in DVD and BR says of Spidy 3, but in the long run it will work out better)
Also, sell the current 80GB SKU at $499 with a free game + Spiderman 3 BR.
$100 for a 40 more gigs and a free game, does seem like a great value.
Now, by realeasing a relatively small number of 500K $399 SKUs for xmas, what that does is create a perception that the PS3 is only $399!!! However, with the limited numbers these thigns will sell out within weeks.
A lot of people will then go the malls and stores with the intention of getting a PS3 for $399, only to be met with a $499 SKU. However, since Sony is throwing in an extra game + double HD space, the percieved value is the same, thus Sony makes the sale no matter.
Sony just needs to create the perception that the PS3 is cheaper....However, the numbers of the $399 SKU shouldn't be soo small that it gets bad press of being unavailable, and it also shouldn't be so mass produced that they lose out of too much sales from the $499 SKU.
I have a good friend who works at Nintendo, and she says they were hearing these $499 rumors weeks before it became big news on the net.
So apparently, this wasn't such a sudden decision. I won't be surprised if this price drop is annonced at TGS along with the realease of the KZ demo.
Perhaps Sony may wait of the Eve of the Halo 3 realease in order to kill some of its hype...who knows.
Congrats. You just reinvented 'bait and switch', a marketing tactic (some might say scam) that has backfired too many times to count in the history of sales. Besides the fact that advertising product while intending to stock a limited amount (thereby deliberately selling out the item advertised) is illegal most places, it is utterly, utterly stupid. But who knows, Sony might just be that desperate.
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