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Summary:

If the PS2 was a license to print money, so far the PS3 has been a license to burn money. According to a Bloomberg article that was released today, Sony could be looking at a 50% loss to its third quarter profits. Other than the weak […]

If the PS2 was a license to print money, so far the PS3 has been a license to burn money. According to a Bloomberg article that was released today, Sony could be looking at a 50% loss to its third quarter profits. Other than the weak PS3 sales, Sony hasn’t been having a good year.

If it isn’t exploding laptop batteries, then it’s something else. Sony has been caught off guard several times this last year by delays or, well, the unexpected. Due to development and manufacturing costs, this years profit forecast from Sony is the lowest within the last five years and Sony seems to be on target for hitting that low. Thanks to delays and pricing issues, Sony is expected to lose 191.9 billion yen this fiscal year.

Though this may be a crowing point for several nay-sayers, this kind of forecast is to be expected. Whenever a new console is launched, there’s absolutely no way for a company to make that money back initially. In fact, the PS2 has done so well because of its longevity and the reduction of the cost to produce them. For now, Sony seems to be on track, but a few more quarters like this one could really hurt.

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  1. K, i call bullshit. The only way it’s impossible for a company to make launch money back initially is if they actively decide not to.

    http://kotaku.com/gaming/wii/wii-autopsy-discovers-manufacturing-cost-221736.php
    http://www.toyokeizai.net/online/tk/headline/detail.php?kiji_no=109&page=3

    Now this is Kotaku. But it’s somewhat believable until i see some actual numbers on what i percieve to be Nintendo’s track record of not breaking the bank with each console launch.

    The immediate argument, if the above holds up, is that the Wii is underpowered. Fuck you. The PS2 was not only the least powerful of the last generation, it was a cheap piece of shit as far as the early components. Not only did it do just fine, it did well enough to fund Sony’s current fuckup.

    Ergo, you continue to lose money bigtime on console launches, you’re a moron trying to cram too much junk into a very specialized device. The PS3 isn’t a justification of selling hardware at a loss, it’s a case study condemnation of it.

    All this horseshit started with the PSX vs. Saturn deal. Yeah, walk out and say “$299″, real good thinking. And note that this only had an arguably justifiable effect when the industry jumped tracks from the relatively refined 2D focus to the stone ages of 3D graphics. For the way it’s getting ever more difficult to percieve differences in the visual quality of these systems, this whole selling at a loss thing is not going to hold up much longer. And i think the proof of that will be that the companies relying on that method will not hold up much longer.

  2. GigaGamez » Archive Sony’s Profits Down 5%; Games Division To Blame « Wednesday, January 31, 2007

    [...] Down 5%; Games Division To Blame By Jason McMaster | As recently discussed, Sony’s game division is doing poorly this quarter. The development and manufacturing costs of the PS3, as well as taking a loss on the hardware, has [...]

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