Playstation 3: Hardware Info and Price

[mckmas8808]

Considering that many consoles would be purchased as gifts, it would be foolish to to discount the price factor.

I will and have never discounted the price factor. That was never ever my point. My point now is the Xbox 360 being a current impulse buy. That's all.

 

[nelg]

I will and have never discounted the price factor. That was never ever my point. My point now is the Xbox 360 being a current impulse buy. That's all.

A large part of what constitutes a impulse buy is related to price.

 

[RancidLunchmeat]

At least in this hypothetical situation. I'm not sure that any of the next gen consoles are actually in that impulse buy range, even though I'm sure people have purchased it on an impulse buy.

Yes, exactly my point for two reasons. The first being that essentially both of these consoles are out of the range of the majority of most 'impulse purchases' as I stated above (still haven't found a study on price point for impulse buys only studies on categories of purchases and impulse buys, but hey.. I go back to work tomorrow, so maybe I'll find the price threshold.) The second being that regardless of what the mean, median, or average of impulse purchases is (in respect to price), that it's probably below what both of these consoles are currently selling for, so for those consumers who are making impulse purchases above the median, they are still eventually going to hit a wall. That wall is lower with the 360 than it is with the PS3, and it's because of the fact that MS offered the Core as an 'entry point'. A $299 entry point is tremendously different than a $499 entry point.

I still think that magical $200 price point is key for that. This is the problem with the PS3 price-point; how long does it take to get below $200. Microsoft will have a version of the 360 below 200 by Holiday of 2007. Sony, I believe, will need 4 years to get there.

As I've said, and I definately agree. Unless Sony is planning on 50% price reductions from six months after launch (which they simply can't do... first they won't have the supply, but second.. it's too soon because price reductions are announced at least a month before they actually hit the stores), then they can't simply win the race with the 360 to the $199 price point.

Really.. We can discuss the definition of 'impulse buyers' all we want. But again, it doesn't matter. I've actually read ten statistical studies since ONE challanged me on it about impulse buyers. The very FIRST threshold that must be passed is disposable income. It's not all that difficult. I know I sound like a broken record, but the studies all show that it's the case. If you have 4 paychecks per month and 3 of those 4 paychecks go to paying off your debt, than you might be classified as an impulse buyer if you spend that extra one paycheck on a purchase you hadn't previously planned to buy.

If that extra paycheck isn't enough to make the purchase, then definitionally, you can't be using it to make an impulse buy.

I don't really know what this is even being argued at this point since KK and any other number of Sony reps have stated from before the price was even announced that consumers would have to save in order to purchase a PS3.

They KNEW the price for the PS3 was going to be out of the range of impulse buyers, and they KNEW it was going to be out of that range for the foreseeable future.

It is going to take the PS3 far longer to get into the range of impulse buyers than the 360 will, because they offer the CORE system.

So to say that the PS3 isn't competing with the Core System is ludicrious. Of course it is.

It is far easier for the median American Consumer to impulse buy a 360 core and then any upgrade on following paychecks than it is for them to buy a PS3. Because they don't have to actually save in order to purchase the MS product.

 

[RancidLunchmeat]

What RancidLunchmeat has to learn is buying a Xbox 360 will never be an impulse buy either for most people. It's either you want it or you don't.

A ridiculous, unfounded, and completely out of this world statement.

The 360 is ALREADY an impulse buy for a certainy percentage of consumers.

Currently, the 360 is possible as an impulse buy for consumers who actually make the MEDIAN INCOME in the United States.

Period. I've given the statistics, I've given the facts. RIGHT NOW at its current price point, the 360 actually CAN be an impulse buy for average American Consumers.

The PS3, if it launches at it's proposed price, can NOT be.

This is factual information, unless you have some source of reference that demonstrates the median income of American consumers is higher than what I've provided.

Furthermore, as the price of ANY system drops, it will become a candidate for impulse purchase depending upon the income level of the consumer.

To make the statement that the 360 will "NEVER" become an impulse buy is foolhardy. There's a reason that the $199 price point is so important. It's so important because that is the price that majority of people who want to own a new console gaming system (as opposed to the price that the majority of people can actually afford to do it), hits the sweet spot so that they have enough disposable income in order to make the purchase as an impulse buy.

Again.. it's the SAME RACE. To say that Sony (or Nintendo) is in a different race than Microsoft is to show your true colors. The race is to $199, and by offering the Core system, MS has at least a two lap lead on Sony and their $499 entry point.

 

[RancidLunchmeat]

Oh yeah of course then that's when it's going to be impulse. That's when it's going to be interesting to see what Sony decides to do. I estimate that time will come in 2008.

HUH? So you AGREE but you are arguing for what reason?

Tap In made it perfectly clear: Microsoft can get to the majority of impulse buyers who want to buy a new console more quickly than Sony can.

What exactly do you think is going to happen in 2008? Are you really trying to tell us that you believe that the entry point for the PS3 will be $199 in 2008?

If so.. Great, wonderful.. Bold prediction and I hope you stand by it.

Not to mention the fact that 2006 is halfway over, the PS3 isn't even released yet, and they'd have to drop $300 off the price of their base unit in one year's time in order to reach that.

 

[mckmas8808]

HUH? So you AGREE but you are arguing for what reason?

Tap In made it perfectly clear: Microsoft can get to the majority of impulse buyers who want to buy a new console more quickly than Sony can.

What exactly do you think is going to happen in 2008? Are you really trying to tell us that you believe that the entry point for the PS3 will be $199 in 2008?

If so.. Great, wonderful.. Bold prediction and I hope you stand by it.

Not to mention the fact that 2006 is halfway over, the PS3 isn't even released yet, and they'd have to drop $300 off the price of their base unit in one year's time in order to reach that.

Why do you always have to look at us communicating on the internet as arguing? In 2008 I expect the Xbox 360 to be under $200 for the core and the PS3 to be $299. Sony will try to communicate that people should spend that extra money because of Blu-ray. Will it work? Who knows.

 

[Davew49]

In 2008 I expect the Xbox 360 to be under $200 for the core and the PS3 to be $299. Sony will try to communicate that people should spend that extra money because of Blu-ray. Will it work? Who knows.

Well by then it could very well be an incentive for people to buy the PS3, that is for sure. Unless Microsoft is selling the HD-DVD addon for $99 by then. I guess it will also depend on what format, if any, has made it as the "leading" format by that time.

DAVEW

PS, How did you like the bogus banning we recieved from that "other" forum, pathetic indeed, woudln't you agree. I like this forum much better anyway.

 

[MrWibble]

I doubt either Microsoft or Sony really care that much about impulse purchases. While the kind of person that buys a console on a whim *might* be the kind of person that will regularly buy software, they might equally play the thing for a week and then get bored of it.

In the mid to long term, both companies want to shift as many consoles as possible - however in the short term, they really would prefer that the consoles sold get bought by people who will also buy lots of software (or peripherals).

I wouldn't be surprised to find that it's actually *better* for them to sell at a higher price while it's in limited supply (I mean aside from them not losing as much money...) because it will tend to sell to people with more disposable cash, who will then buy more software (not that there won't also be some people who scrape together all they have for one, and then struggle to afford software for a while). Lowering the price will mean some people might get a few extra titles initially but they won't have any more cash available on a regular basis, so the tie-ratio after a reasonable period of time will be lower.

As I've said before, when it gets to the point that machines are stacking up on shelves, then the companies will be looking to cut the price to keep their market expanding. But until they find it tricky to sell, they'll milk the price as much as possible. There's very little point debating the high initial price in terms of customers that won't be important to anyone until much later in the lifespan of the console.

 

[mckmas8808]

PS, How did you like the bogus banning we recieved from that "other" forum, pathetic indeed, woudln't you agree. I like this forum much better anyway.

Hey man I swear I looked at your name and started laughing. The sad thing is that thread is worst now then when we were posting in it. I wanted to send you a PM but it seems like you don't have that feature yet.

 

[Shifty Geezer]

I doubt either Microsoft or Sony really care that much about impulse purchases. While the kind of person that buys a console on a whim *might* be the kind of person that will regularly buy software, they might equally play the thing for a week and then get bored of it.

That's a good poibt. I know some people who impulse bought a GB(x), played a couple of games, and that was it. It's all revenue in the end and they won't mind, as long as by that price they're not haemorrhaging on costs. But the major income, also for the software devs who are important people to please if you want games to be made for your system, comes from enthusiast gamers who are likely to be planning purchases, rather than picking one up on the spur of the moment.

 

[NavNucST3]

Why do you always have to look at us communicating on the internet as arguing? In 2008 I expect the Xbox 360 to be under $200 for the core and the PS3 to be $299. Sony will try to communicate that people should spend that extra money because of Blu-ray. Will it work? Who knows.

That is in interesting number manipulation you have there. You give a direct price for the PS3 in 2008, which would require a $200 price drop in year(s) 1.x-2, yet you only give a general price for the 360, which would be in years 2.x-3. If you followed your own logic, shouldn't you have listed the 360 as "under" $100, or is it not possible for MSFT to cut $200 in 2-3 years?

 

[avaya]

UK Retail Commentary (credit Mmmkay @ GAF)

“Given the machine is likely to be a sell-out this side of Christmas, I think the price point is irrelevant for the first six months,” CeX marketing manager Jonathan Cronin told GI.biz.

“If you've got a PS3 next to a 360 you need to be able to see the difference if you're going to be asked to pay more. Microsoft must be pleased there's a nice price differential there,” commented CeX's Cronin.

“The launch frenzy will be there - this is the new PlayStation not the new Xbox. Four million units globally before Christmas? I don't think you'll be able to buy one off the shelf.”

“We welcomed Sony's PS3 announcement at the E3 convention, putting an end to the speculation surrounding a UK launch date,” offered Gamestation group product manager Anna Downing.

“The November 17th date sets up an extremely competitive and exciting Q4, with consumers potentially having the choice of three 'next-gen' consoles on the market. We're anticipating that demand will outstrip supply.”

Steve O'Brien, boss of leading indie retailer Action Replay, agrees. “With the amount of product coming into the UK I think Sony could have quite comfortably priced it at twice the price and still sell-out twice over,” he suggested.

“In the first round of any console sales it's the ******s and hardcore gamers who buy it. I think the strength of the brand is key.”

http://www.eurogamer.net/article.php?article_id=64898

 

[Phil]

That is in interesting number manipulation you have there. You give a direct price for the PS3 in 2008, which would require a $200 price drop in year(s) 1.x-2, yet you only give a general price for the 360, which would be in years 2.x-3. If you followed your own logic, shouldn't you have listed the 360 as "under" $100, or is it not possible for MSFT to cut $200 in 2-3 years?

That highly depends on how much it is costing each to make their console and in how much demand their product is. Sony charging a high price on PS3 may or may not be because of cost, but perhaps is more because they can afford to charge a premium on it (simply because they know they will be supply limited for the first few months). At this point, we don't know who will be able to bring down the price more aggressively: it's all speculation.

 

[NavNucST3]

That highly depends on how much it is costing each to make their console and in how much demand their product is. Sony charging a high price on PS3 may or may not be because of cost, but perhaps is more because they can afford to charge a premium on it (simply because they know they will be supply limited for the first few months). At this point, we don't know who will be able to bring down the price more aggressively: it's all speculation.

If that's your stance so be it, but I think it flies in the face of everything we know about why MSFT went with certain designs; cost cutting.
I would call "wishful thinking" (actually I would use much stronger words, but hey) on a $200 price drop a mere 1.5 or 2 years after launch.

 

[expletive]

That highly depends on how much it is costing each to make their console and in how much demand their product is. Sony charging a high price on PS3 may or may not be because of cost, but perhaps is more because they can afford to charge a premium on it (simply because they know they will be supply limited for the first few months). At this point, we don't know who will be able to bring down the price more aggressively: it's all speculation.

Well, we know that for sure the PS3's BOM will have a 20G HD on it whereas the 360 wont. (when talking about the 'value oriented' SKUs). Then you have to add the additional cost of the BR drive to it as well. The sum of those 2 items, over time, will likely be the cost disparity between the 20G PS3 and the 360 Core.

 

[mckmas8808]

If that's your stance so be it, but I think it flies in the face of everything we know about why MSFT went with certain designs; cost cutting.
I would call "wishful thinking" (actually I would use much stronger words, but hey) on a $200 price drop a mere 1.5 or 2 years after launch.

It was a guess. I pulled the numbers out of my butt. If I'm wrong then I'm wrong. (Which I probably will be).

 

[RancidLunchmeat]

Why do you always have to look at us communicating on the internet as arguing?

Ha! Communicating? That's a rather broad term, isn't it? In fact, what we are all engaging in is the act of argument, or debate in an attempt to sway another's opinon. The better question is Why do you always have to look at us arguing on the internet as having a negative connotation?

In 2008 I expect the Xbox 360 to be under $200 for the core and the PS3 to be $299. Sony will try to communicate that people should spend that extra money because of Blu-ray. Will it work? Who knows.

I'll leave your number manipulation to NucNav's observations, however your conclusions about what Sony will attempt to communicate to the consumer are no different than what they are attempting to communicate now.

Whether it's the difference between $199 and $299 or the difference between $399 and $499, Sony is 'trying to communicate that people should spend that extra money because of Blu-Ray."

To say that is a viable strategy is to disregard the historical importance of the $199 console price point.

 

[Phil]

To say that is a viable strategy is to disregard the historical importance of the $199 console price point.

Historical importance means nothing if the consumer is willing to spend more on a product he feels he's getting the right value for. How ironic that we've already had these discussions when PSP's price was announced and everyone shaked their head in disbelief of the thought of them succeeding with the price tag of a full blown console. How much did historical importance mean then?

 

[rabidrabbit]

Actually, many thought the PSP was to be a $500 device before they announced the price.
I remember even in the internet forums and the news sites, the general concensus seemed to be that the PSP was less expensive than expected!
I think just by searching this very forum, I'd find proof of that.

And the PSP was considered good value when it launched. The big bright screen and glossy stylish design along with it being capable of much more than just gaming was good value. There just wasn't another device that did all the same functions in one high quality device for that price.

Does Sony try the same tactic here with PS3? I think they do.
It's just a lot more difficult now.

First, the PSP was pretty much a unique, novelty device (I know, there had been hanhelds before, but not multimedia handhelds) that was easy to attach an aura of desireability to it.
The PS3 on the other hand is viewed as just the "new console" by mainstream, the multimedia capabilities and "convergence" are more everyday now than with the PSP, and the fact the PSP was a compact device, it being capable of that lot was that more impressive than some personal computer games console high def movie player being capable of all those things and more.

Second, it's not alone there now as the PSP was.
While it still is the only device doing HD-movies from disc, has web browser and messaging as standard, a full Linux OS, standard HDD with full-fledged media center capabilities and access to online media stores, it does have a competitor that does many of the same things for a lot less money.

The Sony marketing is facing a massive task in bringing ahead the advantages and convincing people the PS3 is the device to get.

 

[mckmas8808]

Sony killed the whole "$199 is super important" theory with their sale numbers above that price with the PS2. It's not impossible for a $300 PS3 to sell at the same rate that a $199 x console used to sell at back in the day.

If Blu-ray wins I can see it happening.