Sony Posts its numbers

[djskribbles]

Those are shipped numbers, but still good considering the standalone controller is sold out at many stores across the world it seems, and the launch lineup was just okay.

 

[NathansFortune]

My key question is if they keep moving Kaz Hirai up, who's left to serve us in SCE ? And then what does Playstation mean in the new era ? ^_^

One hopes that Kaz will stay in charge even when he moves up the chain. Sir Howard oversees the E-book reader department directly...

 

[patsu]

Sir Howard oversees the E-book reader department directly...

Heh, it's one of the products I feel Sony should not have gone into hastily. Perhaps Kaz will do differently. Complete Qriocity first. eBook DRM is very weak now. Qriocity should be the entry point, not another eBook reader. IMHO of course !

How many Sony eBook reader sold so far ?

 

[Silent_Buddha]

Not sure, but it was once the top. Then second to the Kindle. The Nook should surpass it soon if it hasn't already.

It faces a rather large uphill battle at this point even with the relatively large price cuts they've had across the board recently. Barnes and Noble (Nook) has the largest book selection. Amazon with the Kindle has huge mindshare.

At this point the best move that Sony could do is possibly a partnership with Barnes and Noble to gain access to the B&N electronic storefront. The problem with that is, they then lose profits from electronic book sales and I don't think the hardware is making much of a profit on its own, especially with the recent price cuts.

And while their PC software for the Reader has gotten better, it's still pretty darn crappy. I believe with the Nook you can buy your books directly from the Nook without even having to use a PC.

I still like the Sony Reader (have 3 of them) but I'm not sure I'm going to buy another one.

Regards,
SB

 

[Dregun]

I don't really agree that Sony has been lacking in innovation as some have stated it. For all intents and purposes Sony has been near the forefront of innovation. While they may not be the first to introduce a product that is new, they generally are the first to introduce that type of product with style and mind share while also trying to improve on it.

How innovative is apple really? Think about it the ipod was popular but it wasn't the first MP3 player. The iphone is popular but it wasn't the first smartphone, the ipad is popular but it wasn't the first tablet etc etc. That is the same type of innovation Sony has, they took the Nintendo system meant for kids and came out with a machine of thier own (PS1) that got more adults involved. For all intents and purposes the PSP is an innovative product, it was/is far superior then the competing products available at the time even though it was just an improvment of an existing product.

Sony's problem (as you can witness with Move) is all marketing related. I still see more commercials for the Xbox and Wii then I do for the PS3 and yet I see almost 10x the advertising for Kinect then the PS Move! The commercials I see the most of:

Apple products (Ipad, iphone) at least 3 comercials an hour
Verizon (Android phones) at least 2 comercials an hour
Xbox at least 1 comercial an hour
Wii about 1 commercial every 2 hours
PS3 maybe 1 comercial ....A DAY!

MS has Kinect tied into everything, between the BK commercials on all the time to the Pepsi comericalsa and advertisements its no wonder it is selling so well. Hell, I was visiting my parents over thanksgiving and my mom was watching the view and they gave away an entire xbox+kinect system to everyone in the audience.

Sony needs marketing more then restructruing! They make great products but do next to nothing to promote them!

 

[Silent_Buddha]

Move appears to be doing quite well as it is. I'm not sure if Sony needs to do more with regards to that or not.

One problem MS is facing (although it's a problem many coporations would like to be in) is that they have drummed up far more interest than they can supply. If this manages to ignite a fad frenzy for the Kinect, then its current marketing budget is a win. If not, then you could view this large marketing push as largely wasted as they could very well have sold just as many units (due to supply limitations) with a much more low key marketing push.

Especially when you think of how many Kinects are being given away for free. BK alone is giving away 100 Kinects a day, that's 3000 a month. Not only does that represent money spent on marketing (whatever the cost of each unit is times 30) but it also represents lost revenue (45,000 USD a month as those are stand alone units) as MS most assuredly would have been able to sell all of those units with no problem.

If MS needed to drum up more word of mouth due to not selling as many units as they could produce then that would be money well spent as those Kinect units wouldn't represent lost revenue. As it is however, interest in Kinect is so high among consumers right now that giving away units for marketing is hugely wasteful both in terms of marketing dollars spent and revenue lost.

But again, this represents, in my eyes, how Sony is taking the far more conservative approach while MS is gambling big.

Sony's marketing appears to match their sell through quite well. Sure more marketing may drum up more interest, but then they may enter into a situation of more interest than supply. Considering Sony has been losing money for a few years now, that may not be somewhere they want to go. They're going to make a lot of cash on Move as it stands if they continue to sell through most of the Moves they can produce.

MS on the other hand appears to be trying to ignite a fad frenzy with Kinect. They are already aware of how many Kinects they can make per week/month/whatever. Yet their marketing is such that it's aimed at generating demand far above what they can possibly supply.

If successful, they'll move it into FAD territory where lack of availability combined with seeing ADs, TV shows with Kinect, Friends and Family with Kinect, word of mouth on Kinect, will actually increase the desire to the point where they feel they "need" it and absolutely must have it. This is that rarified air that Wii, Tamagotchi, Cabbage Patch Dolls, etc. all entered.

On the other hand, it could backfire as most products do, and instead, lack of availability instead means that people who couldn't get one lose interest and never buy one. Thus MS would have ended up wasting all those marketing dollars. This is the more likely outcome unless key things come together.

So, I'm not seeing a particular problem with regards to Move's marketing at this time assuming Sony isn't being misleading with information they've released with regards to how well Move is selling. And I, personally, am assuming that they aren't being misleading.

Regards,
SB

 

[AlphaWolf]

One problem MS is facing (although it's a problem many coporations would like to be in) is that they have drummed up far more interest than they can supply. If this manages to ignite a fad frenzy for the Kinect, then its current marketing budget is a win. If not, then you could view this large marketing push as largely wasted as they could very well have sold just as many units (due to supply limitations) with a much more low key marketing push.

Especially when you think of how many Kinects are being given away for free. BK alone is giving away 100 Kinects a day, that's 3000 a month. Not only does that represent money spent on marketing (whatever the cost of each unit is times 30) but it also represents lost revenue (45,000 USD a month as those are stand alone units) as MS most assuredly would have been able to sell all of those units with no problem.

If MS needed to drum up more word of mouth due to not selling as many units as they could produce then that would be money well spent as those Kinect units wouldn't represent lost revenue. As it is however, interest in Kinect is so high among consumers right now that giving away units for marketing is hugely wasteful both in terms of marketing dollars spent and revenue lost.

Logical fallacy: Kinect is sold out everywhere and MS isn't meeting demand.
Not every person that received kinect from BK would have bought a unit.
Giving kinects away is not worse than advertising. $45k? That's like a whole 30 second commercial, not counting the ads production costs. And you gain word of mouth by getting the product in consumer hands.

 

[Silent_Buddha]

Logical fallacy: Kinect is sold out everywhere and MS isn't meeting demand.
Not every person that received kinect from BK would have bought a unit.
Giving kinects away is not worse than advertising. $45k? That's like a whole 30 second commercial, not counting the ads production costs. And you gain word of mouth by getting the product in consumer hands.

Sure not everyone from BK would have bought one, but demand is so high right now (Stand Alone units selling for 200+ USD), that it would have been snatched up within moments of being put on sale in any retailer.

And depending on cost of unit it's actually higher than 45k. If we were to assume that the cost of each unit was 100 USD (number used purely for example purposes) the cost of using those units for advertising shoots up to 75k (cost + lost revenue).

As a single line item it isn't much, but then you're not seeing the forest for the tree. The BK example is just that. One example of the entirety of their half billion USD marketing campaign. It doesn't even take into account Kinects that are given away in other promotions. Or the money spent on commercials which aren't needed if all you want to do is sell through every single Kinect you can currently manufacture.

IMO, they could have sold just as many units with a 50-100 million USD marketing campaign and probably still had supply issues. The main reason I can see for spending such an extravagent amount of money on the marketing campaign is if you are gambling on being able to turn the accessory into a Fad phenomena. Basically the marketing department at MS was able to convince the exectutives and accountants that they felt there was a chance to replicate what Nintendo accomplished with the Wii. And the executives and penny pinchers in the company agreed.

It's still a large gamble either way. If it backfires, half a billion is a lot to make up. Early signs are certainly encouraging, but we won't know until late next year (or sooner if demand suddenly drops off a cliff) whether it may or may not be an ongoing long term fad.

Regards,
SB

 

[AlphaWolf]

Sure not everyone from BK would have bought one, but demand is so high right now (Stand Alone units selling for 200+ USD), that it would have been snatched up within moments of being put on sale in any retailer.

The $200 units is just people trying to cash in on the popularity. I was shopping on the weekend, I could have bought ~200 kinects at retail price. E-tailers are out of stock, but walmart, bestbuy, futureshop and other retailers have pallet loads of them. I don't think their supply issues are nearly so dire.

And depending on cost of unit it's actually higher than 45k. If we were to assume that the cost of each unit was 100 USD (number used purely for example purposes) the cost of using those units for advertising shoots up to 75k (cost + lost revenue).

As a single line item it isn't much, but then you're not seeing the forest for the tree. The BK example is just that. One example of the entirety of their half billion USD marketing campaign. It doesn't even take into account Kinects that are given away in other promotions. Or the money spent on commercials which aren't needed if all you want to do is sell through every single Kinect you can currently manufacture.

Where do you come up with the idea that those kinects being given away aren't part of the advertising budget? I fully expect that includes every penny spent towards marketing the kinect up to this point. The giveaways are a drop in the ocean of their budget if the $500 million number is to be believed, unless you think they are giving away a million of them?

IMO, they could have sold just as many units with a 50-100 million USD marketing campaign and probably still had supply issues. The main reason I can see for spending such an extravagent amount of money on the marketing campaign is if you are gambling on being able to turn the accessory into a Fad phenomena. Basically the marketing department at MS was able to convince the exectutives and accountants that they felt there was a chance to replicate what Nintendo accomplished with the Wii. And the executives and penny pinchers in the company agreed.

Their goal isn't to just sell a bunch of kinects, they want to sell games. Each kinect in an owners hands is potentially worth a lot more in game sales.

It's still a large gamble either way. If it backfires, half a billion is a lot to make up. Early signs are certainly encouraging, but we won't know until late next year (or sooner if demand suddenly drops off a cliff) whether it may or may not be an ongoing long term fad.

Regards,
SB

Advertising is always a gamble. I think they've executed an excellent marketing campaign, taking a product people were somewhat skeptical about to a must buy. Anyway that's enough in this thread, if someone wants to start a kinect marketing execution thread I'd be happy to discuss it further there.

 

[goonergaz]

lol, this thread has gone way OT!!

 

[dobwal]

IMO, they could have sold just as many units with a 50-100 million USD marketing campaign and probably still had supply issues. The main reason I can see for spending such an extravagent amount of money on the marketing campaign is if you are gambling on being able to turn the accessory into a Fad phenomena. Basically the marketing department at MS was able to convince the exectutives and accountants that they felt there was a chance to replicate what Nintendo accomplished with the Wii. And the executives and penny pinchers in the company agreed.

It's still a large gamble either way. If it backfires, half a billion is a lot to make up. Early signs are certainly encouraging, but we won't know until late next year (or sooner if demand suddenly drops off a cliff) whether it may or may not be an ongoing long term fad.

Regards,
SB

Why are you under the impression that MS blew their whole wad of a marketing budget on the first few weeks of availability?

MS's plan is to sell 5 million by January and its seems logical that the marketing campaign will extend at least through out the holidays.

 

[eastmen]

The key problem with Sony is not whether they innovated. They did. But they didn't focus as a group. Once they can't pull their weight, their high cost will make them incompetitive.

When they did work together, they could perform well. e.g., We saw Sony and partners beat HD DVD camp despite launching one year late. In Cell, Sony reaped the most benefits among the STI partners when even old hands like Intel couldn't launch Itanium and LRB properly.

It took sony buying a second movie company and then paying alot of money for exclusivity for another studio to get bluray to win.

Intel couldn't launch Itanium but it kept its core busniess intact . While sony was trying to move out into newer places. There was a time when people would want sony products and I never understood why. Now everyone wants canon for camera's (took a long time for me to bring them around ) we are all using jvc head phones and are on samsung tvs.


Sony is way behind. The only way I can see the ps4 being sucessful is if they pair with google and even then it would be a google/sony product that is sucessful and not a sony product in and of itself. They are just way behind. The software that forms the base of the playstation 3 is just laughable compared to the xbox set up. Sony online is laughable compared to xbox live. Yes they worked hard to try and catch up , but they are no where near caught up.


Personaly I see google buying sony in the next 5 years so that google can compete with ms and apple better.

 

[Silent_Buddha]

The $200 units is just people trying to cash in on the popularity. I was shopping on the weekend, I could have bought ~200 kinects at retail price. E-tailers are out of stock, but walmart, bestbuy, futureshop and other retailers have pallet loads of them. I don't think their supply issues are nearly so dire.

Where do you live? There isn't a single copy available where I live and if you're close enouogh I'd love to direct a whole bunch of people up that way so they can get a unit. I'm not speaking tongue in cheak either. It's getting annoying having people ask me if I know someplace they can buy it.

Where do you come up with the idea that those kinects being given away aren't part of the advertising budget? I fully expect that includes every penny spent towards marketing the kinect up to this point. The giveaways are a drop in the ocean of their budget if the $500 million number is to be believed, unless you think they are giving away a million of them?

I have to start wondering if you've even bothered to read anything I've posted? I stated quite plainly in the first post mentioning the Kinect giveaways that it was part of the marketing budget. So really, how'd you come to the conclusion that I didn't think it was part of their marketing budget?

You'll also note that in the quote you are replying to I said it was a basically a drop in the ocean. The whole "forest for the tree" as well "As a single line item it isn't much." If English isn't your natural language, it's understandable how you may not have realized seeing a "not seeing the forest for the tree" was alluding to focusing on my singular point of BK giving away Kinect (the tree) while missing the point of my post about the large marketing push (forest).

As for the rest, we've got our opinions and that's fine. This isn't an exact science, otherwise companies would never overspend or underspend on marketing. And we won't know until a couple years down the line whether it was money well spent or not.

But I still hold to my opinion which started this whole thing that there is nothing wrong, IMO, with the amount of money Sony has spend on marketing move. It appears at least at first glance that their marketing push has generated at least enough interest to sell through the Moves they can currently manufacture. The whole sidetrack with the MS marketing budget was to show how excessive (IMO) it is with the evidence that I can see.

Oh one final comment, the 200+ price isn't just individuals.

It's actual online etailers who are selling Kinect stand alone units for 235+ USD now (Amazon.com featured retail partners). Individuals cashing in are starting at 210+ USD. Sure those are smaller e-tailers and thus they are more likely to jack the price up as they are further down the food chain than the larger e-tailers.

Whoops nevermind, changed my mind. Even larger e-tailers like ecost.com and buy.com are now jacking up the price.

And at least one etailer (Tiger Direct) is starting to jack up the prices on high demand Kinect games (The Biggest Loser for them).

Regards,
SB

 

[AlphaWolf]

I have to start wondering if you've even bothered to read anything I've posted? I stated quite plainly in the first post mentioning the Kinect giveaways that it was part of the marketing budget. So really, how'd you come to the conclusion that I didn't think it was part of their marketing budget?

Perhaps the problem is that you're not reading what you write.

It doesn't even take into account Kinects that are given away in other promotions.

Is where i got the idea from. If that's not what you meant, perhaps you could clarify. English works fine for me.

I will admit most of that local supply has dried up since I posted. It still doesn't make spending money on advertising a bad idea. I'm not going to bother with the rest, it's getting too much too far afield for this topic.

 

[Prophecy2k]

It took sony buying a second movie company and then paying alot of money for exclusivity for another studio to get bluray to win.

Intel couldn't launch Itanium but it kept its core busniess intact . While sony was trying to move out into newer places. There was a time when people would want sony products and I never understood why. Now everyone wants canon for camera's (took a long time for me to bring them around ) we are all using jvc head phones and are on samsung tvs.


Sony is way behind. The only way I can see the ps4 being sucessful is if they pair with google and even then it would be a google/sony product that is sucessful and not a sony product in and of itself. They are just way behind. The software that forms the base of the playstation 3 is just laughable compared to the xbox set up. Sony online is laughable compared to xbox live. Yes they worked hard to try and catch up , but they are no where near caught up.


Personaly I see google buying sony in the next 5 years so that google can compete with ms and apple better.

I think you're confusing your own opinions and personal bias' with actual reality. 41 million PS3s sold compared with 45 million 360s at roughly $100 higher price pretty much invalidates your arguments on PS3. Also, anecdotal evidence of you and your friend's own personal AV equipment purchases doesn't equal the vast majority of people out there across the world.

Sony have their issue i agree with you on that, but they still retain themselves as a strong brand that is recognised worldwide. To say anything else is disingenuous.

 

[patsu]

It took sony buying a second movie company and then paying alot of money for exclusivity for another studio to get bluray to win.

Ahem… it's quite a fair bit more than that.

First, they needed to make Blu-ray diodes mass produceable. The failure rate has to be low for the mass market. The yield has to be improved to be viable financially. Blu-ray diode was not easy to make initially. Sony was one of the only 2 suppliers worldwide. They also researched on the disc medium, and invest in the plants to make Blu-ray discs (They are the largest in the world).

They needed to find and negotiate the right partners to form BDA. Something HD-DVD consortium didn't get right. Getting studio buy-ins involved negotiation, not necessarily payment (i.e., joint marketing, cheaper rates for Blu-ray pressing, changing the Blu-ray specs to include Mandatory Managed Copy brought Fox in, etc.). Besides, HD-DVD Consortium paid studios to join them, but they still lost. So $$$ is not everything.

Sony also threw in PS3 to lead the Blu-ray demand, and making it the best Blu-ray player on the market at that time. It involved developing the entire Blu-ray stack and Java VM on PS3. This proved instrumental because once PS3 was released, Blu-ray movies immediately sold more than HD-DVD. Then the studios (including Sony's) churned out Blu-ray movies despite immature BD authoring tools. They also had to market Blu-ray to the consumers despite HD-DVD's FUD and $99 players.

These are just a few things Sony had to do to put the Blu-ray momentum together. I'm sure there are more. Other BDA partners contributed heavily also. It requires careful planning and foresight to commit and execute. Back in 2005, some people -- including Samsung -- thought Blu-ray wouldn't last more than 5 years. They are proven wrong now.

Intel couldn't launch Itanium but it kept its core business intact

Doesn't excuse them from the failures in Itanium and (the first) LRB. Worse when it's their core business. Sony's core businesses are still intact too.

While sony was trying to move out into newer places. There was a time when people would want sony products and I never understood why. Now everyone wants canon for camera's (took a long time for me to bring them around ) we are all using jvc head phones and are on samsung tvs.

I don't think everyone uses canon cameras or JVC headphones or samsung TVs. ^_^

Sony is way behind. The only way I can see the ps4 being sucessful is if they pair with google and even then it would be a google/sony product that is sucessful and not a sony product in and of itself. They are just way behind. The software that forms the base of the playstation 3 is just laughable compared to the xbox set up. Sony online is laughable compared to xbox live. Yes they worked hard to try and catch up , but they are no where near caught up.

Personaly I see google buying sony in the next 5 years so that google can compete with ms and apple better.

We shall see if you're right.

 

[bkilian]

Sony also threw in PS3 to lead the Blu-ray demand, and making it the best Blu-ray player on the market at that time. It involved developing the entire Blu-ray stack and Java VM on PS3. This proved instrumental because once PS3 was released, Blu-ray movies immediately sold more than HD-DVD. Then the studios (including Sony's) churned out Blu-ray movies despite immature BD authoring tools. They also had to market Blu-ray to the consumers despite HD-DVD's FUD and $99 players.

These are just a few things Sony had to do to put the Blu-ray momentum together. I'm sure there are more. Other BDA partners contributed heavily also. It requires careful planning and foresight to commit and execute. Back in 2005, some people -- including Samsung -- thought Blu-ray wouldn't last more than 5 years. They are proven wrong now.

Not entirely. Blu-ray is still less than 10% of DVD volume. Sure, it's growing, but nowhere near the rate promised by Sony and Disney to the other partners. DVD growth is shrinking faster than Blu-ray is growing. A year ago there were still more standalone HD DVD players in the US than Blu-ray players. (Note this was more than a year after the BD format "won") And when you counted in PS3 and the HD DVD addon, BD only wins by 2%.

By all the metrics originally put forward by the BDA, Blu-ray has been a huge flop. Remember, even Laserdisc lasted 20 years...

As to the FUD, there were deceptive campaigns waged by both sides.

 

[eastmen]

you forget that the playstation brand went from being far and away the number 1 console two generations running to being third place all because of bluray.

You also forget to mention that to get blurays to sell prices are allready down to single digits of catalog releases and new releases often have to throw in digital and dvd copies with the bluray to get it to sell. movies like Beauty and the beast didn't need vhs tapes bundled with the dvd to sell , but when i bought beauty and the beast not only did it cost me only $25 but i also got a 10 coupon off toy story 3 and i got the dvd and digital copy of beauty and the beast. In fact to skew numbers even more in favor of bluray , disney no longer puts their classics out on dvd. You can only get the newly un vaulted copies on dvd if you buy the bluray.

I'm not seeing bluray being a shining part in sonys history at all.


As for them not loosing thier core busniess , for over a decade the playstation brand was a core part of their busniess bringing in billions for them and by focusing on bluray it went from performing that well to costing them billions all the while loosing the next generation ovs andf walkman to apple and having other companys become dominate in cameras and tvs .


Sony's in shambles and I don't see anything on the horizon that will bring them out of this. All products that they used to accel at are starting to merge together and its the software that is largely setting these products apart .

 

[Arwin]

All you guys are doing is strengthen patsu's point, that it took 'quite a bit more than that ... '.

 

[eastmen]

All you guys are doing is strengthen patsu's point, that it took 'quite a bit more than that ... '.

i already said that it took them buying support from a large movie studio and buying mgm to make it work.

Sony pictures , MGM and then buying warner support is what they needed to make bluray a sucess.