Sony "revisiting" PS3 pricing/volume strategy

[dobwal]

Read all my posts about the definition

Rationality isn't based on the amount of information at your disposal. Nor is it based on misinformation. Nor is it based on a correct or incorrect outcome. Rationality is simply making a choice or coming to a conclusion based on reason or logic.

 

[Nesh]

Rationality isn't based on the amount of information at your disposal. Rationality is simply making a choice based on reason.

Again you should be more careful with the content you read rather than stick to the irrelevant broader and general meaning of the word

 

[dobwal]

Again you should be more careful with the content you read rather than stick to the irrelevant broader and general meaning of the word

Im basing off your post where you include the amount of infomation or misinformation into the definition, which is in fact wrong.

 

[Nesh]

Im basing off your post where you include the amount of infomation or misinformation into the definition, which is in fact wrong.

Actually that definition is even used academically to describe that exact phenomenon. Its not something I pulled out of my pocket

 

[dobwal]

Actually that definition is even used academically to describe that exact phenomenon. Its not something I pulled out of my pocket

That definition would make this true:

If I were to put on a stolen police uniform and walk around the city, then people who perceived me to be a police officer would have made done so irrationally.


" if they invest, by showing them a graph with a short term period of increasing returns, and the latter does follow their advice, although it is a logical choice, it is considered irrational and wrong based on the standards that an informed, knowledgable investor would have reacted, because he knows that such an action almost quarantees you will lose rather than gain"

No, it would be irrational for a knowledgable and informed investor to a make the same choice as the ignorant one.

 

[Nesh]

That definition would make this true:

If I were to put on a stolen police uniform and walk around the city, then people who perceived me to be a police officer would have made done so irrationally.


" if they invest, by showing them a graph with a short term period of increasing returns, and the latter does follow their advice, although it is a logical choice, it is considered irrational and wrong based on the standards that an informed, knowledgable investor would have reacted, because he knows that such an action almost quarantees you will lose rather than gain"

No, it would be irrational for a knowledgable and informed investor to a make the same choice as the ignorant one.

You are still sticking to one word and ignore the message. I repeat the word "rational" and "irrational" is not used in that sense in my post. I do not describe illogical and logical reactions. Neither is it used in that sense by the academic principles that describe investor or consumer behaviour.

They think logically, and they use rational thinking based on what is available to them as individuals. In that sense I totally agree. The definition I use (as well as academically) describes the best strategy/action that should be taken to maximize utility/gain vs the opposite

 

[NERO]

Sheeesh Folk,

I don't want to bud in but both of you are correct IMO. Ir/Rationality is a complicated subject and I'm not sure if I could explain it any better than you folk. But it is roughly, logical action taken to achieve an end goal. The goal can be equated to the subject's perceived value while the logical action is where people get into trouble. Logic should not be presumed as "correct" reasoning. The (logical) reasoning in achieving a goal is relative. This is where I disagree with Dobwal, in how "Rationality is simply making a choice or coming to a conclusion based on reason or logic". To reason toward a goal, by default, means you have info that fed into creating your perceived value for that goal. Also, if rationality is making a logical choice, than what is a logical choice? That, to me (and correct me if I'm wrong) that implies that there is not only an optimal choice, but an inherent optimal choice. I disagree.

 

[blakjedi]

Rational actors try to maximize their benefit from any given choice based on the information at hand and their perception of value.

People act like the price elasticity of PS3 is high. It is actually very inelastic based on the other choices that rational actors have... the Marginal benefit of PS3 at $600 versus say Wii is actually pretty low currently.

The market is behaving as it should toward PS3. It is exotic, high end, and pricey. Therefore only people that value those elements should be willing to pay for it.

 

[ManuVlad3.0]

Stolen from NeoGAF:

Cheap blue-violet laser diodes to arrive by June

Blue-violet laser diode for BD recorder
"SLD3234VF" (output 170mW, φ5.6mm) Apr, 2007 4,500 Yen
"SLD3234VFI" (output 170mW, φ3.8mm) 5,000 Yen

Blue-violet laser diode for BD player
"SLD3131VF" (output 20mW, φ5.6mm) Jun, 2007 900 Yen
"SLD3131VFI" (output 20mW, φ3.8mm) 1,000 Yen

Blue-violet laser diode for BD recorder
"SLD3235VF" (output 240mW, φ5.6mm) Nov, 2007 4,500 Yen
"SLD3235VFI" (output 240mW, φ3.8mm) 5,000 Yen

 

[Shifty Geezer]

Do we have a current price for comparison? Is a drop to 1,000 Yen something noticeable, or a drop of $10 on current prices?

 

[inefficient]

Do we have a current price for comparison? Is a drop to 1,000 Yen something noticeable, or a drop of $10 on current prices?

Not a direct comparison but by this link (link) Sharp was selling their blue laser diodes for 10,000JPN each just half a year ago.

Sharp Corp. has developed "GH04020A2GE," a blue violet semiconductor laser diode for use in Blu-ray Disc and HD DVD players and will start sample shipment in November 1, 2006. The maximum optical output is 20 mW. When the optical output is set to 10 mW at room temperature, the product ensures the power consumption and life of 168 mW and 10,000 hours, respectively. Sharp says that it has applied its compound semiconductor crystal growth technology that was achieved based on accumulated experience in the development of infrared and red semiconductor laser diodes to the latest product. As a result, the company has achieved what it claims to be the industry's smallest power consumption and the longest life at the same time. Sample price is ¥10,000 per piece. The monthly output target is 150,000 pieces.

From from 10,000JPN in Nov to about 1,000 JPN in April! The price dropped to 10% of the original. Or at least Sony figured out how to undercut sharp by a factor of 10.

 

[PatrickL]

It seems there is a little misunderstanding. Sony was not getting diodes on the retail market but producing them itself. While it is certainly cheaper for them to make them now with better yeilds, the price cut is certainly way lower

 

[nico1982]

Not a direct comparison but by this link (link) Sharp was selling their blue laser diodes for 10,000JPN each just half a year ago.

This seems a bit more recent, a month and an half ago: sample price is 50000 yens for a 210mW blu violet laser diode, ten times the price of Sony's 170-240 mW laser diodes for recorders. Maybe Sharp price is for a 10 diodes package? Are there other significative differences between the diodes? Just economy of scale gearing up?

 

[Nesh]

From from 10,000JPN in Nov to about 1,000 JPN in April! The price dropped to 10% of the original. Or at least Sony figured out how to undercut sharp by a factor of 10.

From 10,000 to 1,000 is more than 10% drop. Right? Othewwise it would have been from 10,000 to 9,000

 

[inefficient]

From 10,000 to 1,000 is more than 10% drop. Right? Othewwise it would have been from 10,000 to 9,000

"dropped to 10% of the original"

 

[Titanio]

It seems there is a little misunderstanding. Sony was not getting diodes on the retail market but producing them itself. While it is certainly cheaper for them to make them now with better yeilds, the price cut is certainly way lower

The prices quoted above from Sony though are their prices for retail products.

The question is if Sony's margins are the same as Sharp's and are maintained with the new cut. Of course, we cannot know these things..

 

[Nesh]

"dropped to 10% of the original"

Excuse me for asking again,but which was the original and which is the current as I ve lost you there

 

[Evildeus]

Excuse me for asking again,but which was the original and which is the current as I ve lost you there

Original = 10000
Current = 1000

Current = 10% of the original.

Got it now?

 

[Platon]

Original = 10000
Current = 1000

Current = 10% of the original.

Got it now?

The thing though is that those 10000 is not Sonys original, as I understood it, rather the retail price from Sharp, and hence the cost for them could be anything...

 

[-tkf-]

The thing though is that those 10000 is not Sonys original, as I understood it, rather the retail price from Sharp, and hence the cost for them could be anything...

I think the cost must have been substantial, way more than i expected.