PS3 slim in 2009, rejoice or too early?

[Prophecy2k]

I think the vote options are to limited.

Basically Sony/PS3 is hurting due to high price, it seems they need to drop the price. Most likely they can not do this without losing more money with the current model. The only option seems to be to introduce a lower bom cost version ie the slim.

As I see it.

1. Keep current price and and not reach sales goals for the current year and lose money on hardware.
2. Drop price on current sku and reach sales goals (assumption yes) and lose even more money on the hardware.
3. Introduce slim, drop price and reach sales goals and maybe get close to break even on the hardware.

So if you want to introduce the slim next year with motion control stuff to create a hype/impact. what about the time between now and when they release it?

For all we know Sony might be contracted for a certain component MOQ for the year anyway, so if they manufacture the devices or not, the components will have to be bought or penalties incurred.

Personally I think that Sony will release the Slim this side of their current fiscal year and well before they release the PSMC. Even Stringer confirmed outright by his comments toward Mr Bobby Kotick that he can't drop the price of the current PS3 without losing a significant amount of money on each console sold.

Releasing the Slim now in order to allow for further price drops before Christmas will only be a win-win for Sony. You'll get the initial hardcore adopters who will rush to buy the Slim because of the fact that it's new or it's aesthetic allure. Then as the holiday approaches Sony can ramp up marketing, drop the price and start doing more casual title-focussed bundles (maybe even bundle the Slim with the PSEye and eyepet, to get more PSEye's out there).

The last thing they want to do imho is release the PSMC with the Slim, as it could confuse consumers and have current PS3 owners thinking that they need to buy a new PS3 Slim for the PSMC to work. If the Slim has already been released a few months prior (and bundled with the PSEye) they can release the PSMC as a peripheral product with it's own dedicated killer app. They can bundle the new controller with the Slims at that time too and then simply market the heck outta the thing.

That's what I'd do anyways...

 

[gongo]

Keep the comments coming! There are 2 points which are confusing. Why would the slim cost less for Sony than the phat? Ok the material for the casing and packaging would cost Sony i guess, the PCB too. But if the cost cuttings of the chips and drives are already in place, how much more they would save? Do we see Sony cutting down on features?

The other thing as a believer of lesser SKUs the better, would having a single Slim w/ PSEye+ relaunched model have better impact then releasing the slim, then the PSeye+, then trying to market the new experience? IMHO, this seem half baked a strategy. The immediate problem of PS3 is the price. If Sony drop it, they will have the sales. A slicker model no doubt will catch more news but remember Xbox360+ is coming just about next year too. Sony need a fresh SKU to compete. They could risk a chance to have more audience for the PSEye+ if sold separately. They may point out what they did with the DS1 and PS2 Network Adpator, but times are different, stop looking at your past success SCE! There is without any doubt MS will market THE HELL OUTTA 360+ Natal. I bet my last dollar on it!

But could Sony felt they have some lag time with the PSEye+ to afford the staggered launch instead of bundling with the Slim. Natal could possibly be only available on the 4Q 2010. Thinking of it, this does feel like the PS2 Online vs Xbox1 Live again. One strength of Xbox success is how MS hammered down a set of standards, heavy-handed or not. This does provide a coherent experience.

I think the slim PS3 apart from taking less shelf space, is it any more appealing than the phat? I dont think so, how about you? The rumors are the slim PS3 will sell higher or at the same $399. Could be another wasted marketing opportunity.

 

[JPT]

Keep the comments coming! There are 2 points which are confusing. Why would the slim cost less for Sony than the phat? Ok the material for the casing and packaging would cost Sony i guess, the PCB too. But if the cost cuttings of the chips and drives are already in place, how much more they would save? Do we see Sony cutting down on features?

Well its not just the plastic casing, but the slim will probably have new and cheaper cpu/gpu which probably cost less to produce and they run on less power which means less heat, which means less shielding etc.
In the end there is a "big" reduction of everything, of course Sony could stuff this new mainboard into the old casing, but why not change the form factor when its no longer needed to be as big and people usually likes slim models.

Basically is just an evolutionary cost down of a product, usually those are not done for the end customers sake, but to have higher profits, but in the PS3 case, they want to bump up the sales and it looks like the only way to do this is to drop the end user price.

Anyways I am not into manufacturing, I design networks, but I used to work for a network hardware vendor, so I think my perception of this isnt 110% wrong

 

[StefanS]

Keep the comments coming! There are 2 points which are confusing. Why would the slim cost less for Sony than the phat? Ok the material for the casing and packaging would cost Sony i guess, the PCB too. But if the cost cuttings of the chips and drives are already in place, how much more they would save? Do we see Sony cutting down on features?

Well, the way you word it, you want to specifically exclude the gains Sony makes from shrinking their processors (die size, shielding, etc.). In that case it just boils down to casing, packaging, shipping (don't forget, it is usually based on volume!), etc.

But the main advantage lies in the reboot of the PS3 in the mind of the consumer. Nicer design, smaller form factor coupled with a price reduction could spur better sales, if we take the precedents of PS2Slim, Nintendo handhelds, etc. into account. As such a move comes with little risk and little R&D costs, it is worth the gamble, IMHO.

 

[Richard]

Original PS2 size is what I last heard.

Nice, thanks.

 

[Silent_Buddha]

But the main advantage lies in the reboot of the PS3 in the mind of the consumer. Nicer design, smaller form factor coupled with a price reduction could spur better sales, if we take the precedents of PS2Slim, Nintendo handhelds, etc. into account. As such a move comes with little risk and little R&D costs, it is worth the gamble, IMHO.

Well the design basically still looks the same so that hasn't really changed other than losing a little bit of "bling" on the Slim.

The smaller size is nice but still doesn't solve the problem with the rounded top if you didn't like the PS3 originally because of it.

Price reduction could produce better sales, but then it keeps the PS3 Slim in the loss leader category similar to the PS3. Only now you move more units, lose more money overall, and have to hope that software sales improve enough to cover the additional losses from hardware and eventually show a profit.

Or they keep it the same, don't make as many sales, but possibly break even or make a small profit on each sale of a PS3 Slim. As long as they can sell all the Slims they make it won't dig them further into the hole with regards to their profit, which is continuing to plummit quite badly.

Unfortunately, it's not a matter of good option versus bad option.

Reduce the price, and they have to see massively increased software sales to make a profit. If it happens though the profits could be significant.

Don't reduce the price, and your probability of making a profit go up much more, but the potential profit is much less.

The gamble they end up taking will be determined by how optimistic Sony is that this holiday season will be more like 2008/2007 than what 2009 has been so far with regards to gaming revenue.

Personally, I don't see this holiday season coming anywhere close to either 2008 or 2007.

And to put things into perspective when you try to imagine what the Sony Execs must have on their minds. Sony last year for this past quarter posted a profit of 4.6 billion yen. This year they posted a 39.7 billion yen loss.

That is they lost approximately 8.6 times as much as they gained int he same quarter last year. Or in other words it would take them over 8 years of that type of profit to make up the losses from this last quarter.

If they end up showing a loss for the holiday season, rather than lessing the time to recovery, it's going to put the company that much farther away from recovery or that much closer to bankruptcy.

And as much as people like to think that company financials have no impact on consumers, if Sony goes belly up, that's most certainly going to affect a lot of people. Something I don't want to see as I've always like Sony despite some boneheaded moves (their initial foray into MP3 players for instance ).

Anyway, all this just means I'm really not sure which way Sony is going to roll the dice. Go for the safe road and release the PS3 Slim at the same price as the current PS3? Or gamble the company on a reduce priced PS3 Slim.

Regards,
SB

 

[Oninotsume]

PS3 $199: David Jaffe

Hi,

This looks a few days old, but I hadn't seen it anywhere,
so I thought it might be worth a post.

David Jaffe somewhat confusingly "claims" a $199 PS3 price drop.
http://twitter.com/djaffe/status/3099971208

Oniotsume

 

[deepbrown]

Hi,

This looks a few days old, but I hadn't seen it anywhere,
so I thought it might be worth a post.

David Jaffe somewhat confusingly "claims" a $199 PS3 price drop.
http://twitter.com/djaffe/status/3099971208

Oniotsume

It was a joke.

 

[Oninotsume]

It was a joke.

That would explain why it was confusing.

Thank you.

 

[Rolf N]

The chip process shrinks and casing shrinks aren't entirely coincidental, which makes it not very useful to look at their cost implications separately.

Smaller chips, less power consumption begets smaller heatsinks and power supplies, and at some point keeping a cavernous case in place for innards that could fit in much less becomes wasteful.
Internal advances alone can cut down on the BOM and the weight, which reduces shipping expenses somewhat, but cutting down on size when you can brings much bigger gains. More units per boat is pretty significant, not to mention warehouse and retail storage.

The original PS3 shell is huge by any comparison. Huge enough that, after this first one, I expect a second visible case shrink to happen for the PS3, in a few more years.

 

[Crossbar]

Smaller chips, less power consumption begets smaller heatsinks and power supplies, and at some point keeping a cavernous case in place for innards that could fit in much less becomes wasteful.
Internal advances alone can cut down on the BOM and the weight, which reduces shipping expenses somewhat, but cutting down on size when you can brings much bigger gains. More units per boat is pretty significant, not to mention warehouse and retail storage.

That is exactly my thoughts also, they will save a few pennies on the paper box as well.

The original PS3 shell is huge by any comparison. Huge enough that, after this first one, I expect a second visible case shrink to happen for the PS3, in a few more years.

I expect the next case shrink to happen when they merge the Cell and RSX which will likely happen at the 28 nm process and be released approx. 2013.

 

[JPT]

I expect the next case shrink to happen when they merge the Cell and RSX which will likely happen at the 28 nm process and be released approx. 2013.

Is that really feasible? I thought the practicals where just to cumbersome to outweigh the advantage.....

 

[Crossbar]

Is that really feasible? I thought the practicals where just to cumbersome to outweigh the advantage.....

When Cell has been moved to a bulk CMOS process, which Toshiba is working on, then a major argument against a merge has been removed.

 

[Kaotik]

-MS will make a big push for Natal, signs point to a "new" Xbox+ with bundled natal and some specs upgrade(higher resolution forward compatible?)

This might have been answered already, but as I'm drunk I didn't notice if it has
What exactly do you mean by this? Doesn't the box allow upscaling to 1080p anyway, and since there's no (really) TVs available with higher res, any possible higher res would be waste?

 

[Rangers]

Still seems kind of strange that many on neogaf are saying this is confirmed for late august early september, yet no credible leaks of units in the supply chain have popped up yet..

 

[gongo]

Kinda felt the need to bump up this thread after the November NPD....i dont know...but the 360 outselling the Slim does not bode well for Sony...i fear the new-ness of the Slim is wearing out way too fast for my liking....and when MS pushed their Xbox Natal next Christmas...what "new" SKU will Sony use to counter Natal + Halo:R? Call it the benefit of hindsight...or not, but i would really wished Sony will do the Slim + PSWand + 32nm CPU/GPU next year...just drop the price of the phat for this holiday season....would have the same effect....now the new-ness factor and the bundled marketing of PSEye_MC has taken a hit....bad judgment, no?

 

[woundingchaney]

Kinda felt the need to bump up this thread after the November NPD....i dont know...but the 360 outselling the Slim does not bode well for Sony...i fear the new-ness of the Slim is wearing out way too fast for my liking....and when MS pushed their Xbox Natal next Christmas...what "new" SKU will Sony use to counter Natal + Halo:R? Call it the benefit of hindsight...or not, but i would really wished Sony will do the Slim + PSWand + 32nm CPU/GPU next year...just drop the price of the phat for this holiday season....would have the same effect....now the new-ness factor and the bundled marketing of PSEye_MC has taken a hit....bad judgment, no?

Sony does have a powerful line-up of titles coming next year as well as a motion controller of their own. Quite frankly I am very doubtful of the motion control introductions for these 2 consoles. Im doubting the existing userbase is going to be over adoptive initially and I dont feel as if either console is that much of a draw for new consumers by simply incorporating motion controls. Sony and MS are going to have to seamlessly introduce and support motion control for their platforms or it will be another example of a good yet unsupported idea.

Realistically I agree that MS pushing Natal and a new "slim" 360 could be problematic for Sony though going into 2010 there is little doubt that Sony has the momentum on a world wide scale.

It doesnt seem like a bad decision or even a good decision on Sony's part to me. I simply think that Sony drastically needed to reinvent their image amongst consumers as quickly as possible and I believe they have done so very well.

As far as sales; while Sony may have lost NA in Nov. what little information about the rest of the world that is available suggests that they are steadily outselling MS ww, though the margin is muddled due to lack of solid statistics.

 

[ShaidarHaran]

I don't think Sony has to outsell MS for the PS3 to be successful, but they needed to sell a lot more than what the previous PS3 SKUs were pushing while also reducing costs, and that is precisely what they've accomplished with the Slim.

 

[woundingchaney]

I don't think Sony has to outsell MS for the PS3 to be successful, but they needed to sell a lot more than what the previous PS3 SKUs were pushing while also reducing costs, and that is precisely what they've accomplished with the Slim.

I agree that it isnt necessary for them to "outsell" the competition to be successful, but every consumer that one brand picks up can to an extent be considered a sale lost by the other (given that multiconsole ownership is not common). So for one company to maximize their install base they need to acquire sales prior to the competition. This is most likely more relevant for MS and Sony as their platform experience and direction have a tendency to mimic each other.

 

[Silent_Buddha]

I don't think you can gauge any trends by one month, much less the month of November which has an undue amount of sales on one day (black Friday) that is greatly influenced by small targetted marketting.

And 800k versus 700k? that's neither here nor there. I'm sure Sony wasn't expecting the X360 arcade to be basically sold for 99 USD at the US' largest retailer. And the MW2 bundle I'm sure sold well...

If the difference had been 800k vs 400k, ok you might be able to draw some conclusions, but all you can gain from this is that MS blunted Sony's momentum slightly... The next few months will give a better gauge of who's got momentum going...

And as to the topic, I think the Slim has done, and continues to do a great job in revitalizing the PS3 brand in the US. Unfortunately, for who knows what reason, the PS3 still isn't moving much software overall...

Regards,
SB