jvd said:
why with vinces and some others thinking in this thread once its in the ps3 it will become mass market and cheap. Which means everyone will have them. Which of course will bring the pricacy to new lvls not seen since the dc days .
That's not what I'm saying in the least and by you even raising that opinion shows just how futile having a true discussion based on sound principles is with you. Thank you, I'll spend my time elsewhere.
My gosh, I've spent the last 5 posts explaing what a commodity good is and why is demands it's prices based on economic/commerical perception and not materialist costs. Yet you can't understand any of it... this is sad.
function said:
Of course, Sony and others may want to keep BR as a high margin product for as long as possible. Making it a standard feature in a $300 console could be against some peoples plans, though I don't think this would be a good enough reason not to try and spread BR as widely as possible.
Excellent point, truely. But if you'd think it threw you'd see the obvious fact that what's keeping Blu-Ray priced so high isn't the manufacturing costs, but rather the marketplaces perception of it and it's high demand for it to fill a specific high-end niche.
Thus, even in the scenario where they can ramp up production to, say, 10X the current level while still charging the same amount, they can do this if the equilibrium market price will allow for it. But that's not in the least representative of the cost of integrating the actual physical parts in a phantom PS3. Thus, this differiential between the tangible material cost and the actual sale level is negligable when it comes to Sony Group's ability to integrate it in PS3 @ fair value material/production costs and should be discarded for reasons that are obvious.
Basically, this argument is simple. Blu-Ray players don't cost $3K in parts to make - you'd need to be a moron to accept this. Jvd, before he backpeddled and stareted arguing on useless rhetoric, even admitted to the physical parts costs being in the ~$500 level which is probobly correct. This level is based on the current situation where there is low volume production with one vendor [eg. Sony] in the marketplace. Thus, prices are high following basic Price Theory.
Yet, if we can agree on this [which Jvd already did and I'll hold him to it] then it easily follows that if it costs ~$500 in raw parts in 2003 to produce, that ramping production up on Sony's fixed cost assembly lines will only scale the costs down near linearly. Thus, we can reasonably assume that when keeping Blu-Ray's widespread appeal and vendors acceptance in mind, that it will be in much higher volume production in 2 years. Perhaps, conservatively, in production by 5 vendors @ 10X current production rates in the 2005 timeframe. At this level, the per device costs will be sub-$100 in parts alone if you consider near linear scaling from current levels as defined by Jvd himself.
Following in the obvious fact that SCE is part of Sony Group, we assume that the Blu-Ray parts can be produced at negligable profit from these internal Sony resources and sold right above (or below) material costs -
Not Commerical cost. Right there, that's a sub-$100 Blu-Ray player based on parts alone.
Unfortunatly, some people here can't comprehend or are totally unfamiliar with the concept of modern micro-economics and Price Theory. Instead they're deluding themselves in this fantasy world of high costs in which the market price is the manufacturing costs in high-end commercial goods.... I fear for the future if this is any indication.
Funnily enough, I don't think I've done that, but that you have. You actually introduced processor prices (that I was responding to in the quote below) into this.
It's was a perfect parrallel that demonstrates how a comapny can price a high-end commodity good at a multiple of it's true manufacturing cost. Your have to be legally dead not to see this all over the indurty. Hell, get an education and there will be a basic economics class in there somewhere.
What's the point in asking me to show you "the economics book that differnetiates specifically between Price Theory for CPUs and Optical Hardware"? You introduced the CPU comparision, but I didn't ask you to show you the econmics text book that showed specifically that there was no ... etc, etc. I guess we're done here. I think you'd agree.
No, I can show you any basic (like High-School) level economics book that teaches basic microeconomic theory. You, on the otherhand are arguing out of sheer ignorance in deluding yourself thinking that there is a tangible difference between one good and another in how Price Theory views it. We'll I'll give you the Cliff Notes verson - There isn't - it's Supply and Demand. Period.
All commercial goods have differing amounts of market Supply and Demand; doesn't matter if it's a brand new Blu-Ray recorder or that "cutting-edge" 3.2Ghz Pentium4. Neither good is differnent to Price Theory, they're both goods that are in high demand and low supply with a high market appeal and as such can demand massivly inflated prices that are multiples of their production costs. Again, the costs are dynamic according to market forces and beyond that there is no differnence. You even stating this opion shows me how futile this argument is. It's like arguing against a 10 year old. I allways thought highly of B3D, but with people like Ben and Q (among others) MIA, the level of conversation is attrocious - why must everything be on the simplistic level of Chap's prior post? Perhaps if I only used more l33t thinking....
