PSP's margins.
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$350 loss per unit sounds a little insane but I wouldn't doubt $150+ at the 19800 yen launch price. Kutaragi already confirmed that only 50% of the unit cost amounts to internally produced parts, citing the screen, memory and WiFi chip as outsourced. Shog's right too, that 4.3 inch widescreen 200 cd/m2 Sharp ASV LCD is going to cost a pretty penny... at least $100 if not more. Throw in 32MB of RAM and the WiFi PHY... and you're only at half the cost of the unit upfront? :/
Granted costs will nosedive as production gets up to speed (and especially when revisions move to 65nm and get all that RAM on one chip), but with about half of PSP outsourced I'm not sure things can possibly go as smoothly as PS2 (especially as demand will undoubtedly be lower). Sony needs to consider bringing screen production inhouse via their Samasung partnership at some point I'd say.
A little off topic, but anyone care to speculate what it costs to make a DS?
Granted costs will nosedive as production gets up to speed (and especially when revisions move to 65nm and get all that RAM on one chip), but with about half of PSP outsourced I'm not sure things can possibly go as smoothly as PS2 (especially as demand will undoubtedly be lower). Sony needs to consider bringing screen production inhouse via their Samasung partnership at some point I'd say.
A little off topic, but anyone care to speculate what it costs to make a DS?
You'll be surprised.jarrod said:
There was a book about the development of the XBox, and the costs of memory, CPU and GPU per unit when bought in bulk were cited. Of course to date MS is still losing money on the system overall, but you'll still be surprised at the cost of those components when compared to how much you pay at retail.Besides, other than the 'optimized in-house production' angle, it is not surprising that as a hardware company, they can negotiate lower prices for hardware components - business partnerships/relations and all that. And assembly of these outsourced components is still carried by themselves.
Sony is too smart to sell stuff at a loss. Only losses incurred initially should come from the advertising, administrative, distribution, R&D, etc. costs. Doesn't matter if everyone doesn't believe it. It is an added bonus if a competitor also believes that - then get burned trying to mimic the strategy.
Truthfully, I thought Shog was being generous with the $100 figure for the screen. This technology is usually reserved for high end televisions, this is the first handheld electronic to use an ASV LCD even I believe. No doubt Sharp is cutting Sony a great deal (as it's suppossedly a gigantic order) but this stuff isn't exactly cheap. High end outsourced components will bring high end costs with them regardless.passerby said:You'll be surprised.
Heh, then why'd that 33,000 yen figure circulating within Sony (and accidentally leaked by SCEE's Manfred Gerdes) suddenly evaporate after Nintendo announced their DS pricing and launch details early? I guarantee you, PSP wasn't set to be 19,800 yen a month ago.passerby said:
jarrod, what did you get banned for at GAF?
I really do think that $100 per LCD panel is overblown. As a consumer, I can go to Sharp's site and purchase a 15" 1024x768 LCD monitor with better brightness and contrast specs than the PSP panel has and its $400. You could essentially get 6 PSP panels out of the material required for that one 15" panel, with a little to spare. I'd be very surprised if Sony is paying more than $70 per unit to buy bare 4.3" panels in bulk, and even that seems a little high to me.
I really do think that $100 per LCD panel is overblown. As a consumer, I can go to Sharp's site and purchase a 15" 1024x768 LCD monitor with better brightness and contrast specs than the PSP panel has and its $400. You could essentially get 6 PSP panels out of the material required for that one 15" panel, with a little to spare. I'd be very surprised if Sony is paying more than $70 per unit to buy bare 4.3" panels in bulk, and even that seems a little high to me.
jarrod said:Heh, then why'd that 33,000 yen figure circulating within Sony (and accidentally leaked by SCEE's Manfred Gerdes) suddenly evaporate after Nintendo announced their DS pricing and launch details early? I guarantee you, PSP wasn't set to be 19,800 yen a month ago.
Using a rumor won't help your cause.
<- From GameSpot's rumor control.
Furthermore I think your connection to the release of the DS price is tenuous at best as by the date of the SPOnG article (21st Sep 2004) everyone knew long before that the DS would be quite cheap. Also the DS dropped ~ $50 from the projected price so why then did the PSP drop by (over) a $100 and not just match the $50 drop? This seems to disprove your belief that the official word for the DS price caused the price for the PSP to be reduced.
Self imposed exile. I'm taking a month off because I spend way too much time there... so now instead I'm ending up at other forums wasting time. :/kaching said:
Well, it's possible though are you sure that $400 LCD is the same technology? Marco and others have been going on about how high end the PSP screen is and how this sort of screen's never been used in a portable electronic before.kaching said:
SPoNG wasn't the only source that quoted Gerdes, the media at large was pushing the figure initially. It actually happened I'm sorry to say, GameSpot rumor control or not.Ty said:
Well Sony delayed their conference some 17 minutes after the DS price hit the wire... and then no PSP launch details were given as promised. It's a pretty insightful coincidence at the least.Ty said:
Also, a hacked page from NCL's website reveals they were willing to go as low as 10,000 yen for the DS launch. I think both sides are playing cat and mouse here really, which is to be expected.
Self-imposed exile, eh? I could have told you that wouldn't work. I think that's how I got hooked on GAF in the first place
Yes, I'm pretty sure that the $400 LCD is basically the same technology. While the PSP screen quality may be somewhat unprecedented in the portable space, its nothing particularly special in the desktop space.
Yes, I'm pretty sure that the $400 LCD is basically the same technology. While the PSP screen quality may be somewhat unprecedented in the portable space, its nothing particularly special in the desktop space.
The ASV technology is just a tech developed by Sharp, it does not mean it's specially more expensive to produce or anything.
The LCD screens using this tech are sold at a premium with regards to other screens, solely because those screens have better specs (Wider viewing, crystals face all directions, response time), not because the technology is horribly more expansive/complex.
About the PSP price strategy, you have to remember that Sony CE never price their consoles out of the market, they might be more expansive by a few %, that's true.
But expecting Sony to enter a new market, where Nintendo is the undisputed champion since... ever, with a machine price 200% the price of the new Nintendo's product, was really underestimating SCE's marketing talents. Creating/appealing to a new market or not.
The LCD screens using this tech are sold at a premium with regards to other screens, solely because those screens have better specs (Wider viewing, crystals face all directions, response time), not because the technology is horribly more expansive/complex.
About the PSP price strategy, you have to remember that Sony CE never price their consoles out of the market, they might be more expansive by a few %, that's true.
But expecting Sony to enter a new market, where Nintendo is the undisputed champion since... ever, with a machine price 200% the price of the new Nintendo's product, was really underestimating SCE's marketing talents. Creating/appealing to a new market or not.
Good to know, and I wouldn't doubt PSP coming in lower than some have implied (though it should also be stressed that many of the sources claiming extremely high production costs reiterated it was also primairily due to accelerating launch for December in Japan and costs will plummet once production lines get up to speed). It could cost $400 per unit today and only $200 next March after all.Vysez said:
True but then again DS was rumored to come in at 19800 yen itself before Nintendo set the price officially. The timing of the DS announcment, Sony's conference delay and Gerdes 33,000 yen leak is all suspicious to say the least.Vysez said:
jarrod said:
Just because more than one website mentioned it does not automatically lend more credence especially if they simply copy the same source of the rumor. In other words, the quote needs to be better sourced imo.
jarrod said:Well Sony delayed their conference some 17 minutes after the DS price hit the wire... and then no PSP launch details were given as promised. It's a pretty insightful coincidence at the least.
Possibly but as always discussions of this nature (the actual cost of hardware) is at best, outsiders simply guessing.
Spong didn't actually break the news though, it was Gamefront (who retracted it after SCEI officially denied, as have most sites who ran the story initially). CVG quotes it as well, Gerdes actually confirmed the 33,000 yen price point.Ty said:
http://www.computerandvideogames.co...eogames.com/news/news_story.php(que)id=110025
Sure... but really isn't that all we have to go on?Ty said:Possibly but as always discussions of this nature (the actual cost of hardware) is at best, outsiders simply guessing.