06-26-2008 10:54 PM #1
Sony has lost over $3 billion on the PS3
If you dont want to click the link.
Think you paid too much for your Playstation 3? Don't expect any sympathy from Sony.
In the company's fiscal 2008 annual report, Sony revealed that they've now lost roughly $3.3 billion (that's billion with a B) on the Playstation 3 since its launch. That breaks down to $2.16 billion in 2007, followed by a notably smaller but equally daunting $1.16 billion loss in 2008.
The reason? Pricing the console below its production cost. That's right - that hefty $599 you paid for the PS3 back when it first launched was significantly cheaper than the cost of producing it in the first place, and while the retail price has come down some, the losses keep piling up.
Investors have reason to sweat. In a statement, Sony claimed "the large-scale investment required during the development and introductory period of a new gaming platform may not be fully recovered." They went on to note that they've invested a great deal of money into R&D for the console, a sum they might not be able to recoup if the PS3 "fails to achieve such favorable market penetration."
Sony fanboys should take heart, however. Losing money on hardware is relatively common in the video game biz, as companies routinely lower prices to sell more units and thus stimulate software sales. Sony's game division saw a 26% sales spike last quarter, a trend they expect will continue on the strength of strong exclusives like the recently released Metal Gear Solid 4 and the upcoming sequel Resistance 2.
But will it be enough?
Do we have what microsoft has lost to this point on the 360? Not to mention repair costs for rrod.
What do you guys and girls think? With the expected life span of the ps3 do you think they will be able to make up this deficit?
06-26-2008 10:56 PM #2
Old, but I think total debt for the Xbox division, is like 4 or 5 billion isn't it?Don't Reach, Young Blood
Part of The Finer Things Club, The Ghostbusters Club, The American Psycho Club, The SDF on 360 Club
06-26-2008 10:59 PM #3
If it is Microsoft is not doing anything to help their situation with a new console coming in about 2 years
06-26-2008 11:03 PM #4
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