Thread: Sony: Life and times

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  1. #1 Sony: Life and times 
    Senior Member PSP Elite Hacker Switchblades's Avatar
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    I've recently done some research on Sony's recent investments and... to me it looks like they're heading down the tubes unless the PS3 takes a turn around. Here's my theory of what's going to happen to Sony in the next few years. Bare with me, feel free to argue with me or not. It's just a theory. Remember, I'm just a 14 year old who has an interest in the future gaming world, my theory might be completely off track so feel free to criticize. I'm taking a shot.

    Note: Most of the information in the Red colored text is background information about Sony. It's not essential read

    Sony's had a lot of success over the last couple years. What with their launch of the PS1 which remarkably sold more than 100million. Then, a few years later, Sony decides to take another dip into the gaming economy and releases one of the world's most dominant systems of all time: the PS2. Selling over 120 million, a cold instant success for the PS2.

    Now, even though these two systems sold remarkably well over the last couple decade, they weren't without their fiscal years. The PS1, an MSRP of $399.99 was decided for the launch price. The PS2, a launch of price of $499.99. Those first starting fiscal years for Sony lost them over $1.1 billion. Luckily, their brand picked up in sales and shot to the top of the gaming economy. Sony had its glory back.

    In 2004, Sony unveiled its not-so-much-as-a-hit in the market: The PSP which we haev all come to love. Selling roughly only 36 million units and the most widely sold game only arching at 2.3 million with Monster Hunter Freedom 2 (results vary up to 2007) the PSP front looks pretty rough for Sony. These last couple of years, the Nintendo DS dominated the portable gaming market; outselling Sony's PSP by over 30 million units and leading game outselling MHF2 by 16 million. The DS won economic supremacy in the potable gaming world.


    Next... in 2007, Sony decided to launch its PS3, supposedly the cold multimedia hit of the gaming world. Looking at the number of units sold and the extremely high cost of production, Masaru Ibuka and Akio Morita might have to make some cutbacks.

    The launching MSRP cost for the PS3 was at $700 where I lived. A ridiculous price for a system, even more ridiculous when I did some research about the cost to produce the machine. I felt sorry for Sony's $200 loss plus I highly support them so, I bought a PS3 the 4th day it came out. When I got home to play my PS3... I wasn't *that* impressed. It was basically like my 360 but had a touch of better graphics. It's like the difference between a 8800 GT and a 8800 GTX, hard for me to tell the difference. I immediately thought to myself: "wtf, this isn't worth $700." But I endured it for a few days and eventually got bored with the lack of online playability and turned back to my 360.

    Looking now at the PS3's LAUNCHING (2007) RAW MATERIAL cost. Almost $850 dollars worth of equipment is put into a single device. The blu-ray player alone costs $180~$230 while Microsoft is only paying around $30 for their HDVD players in their 360s with just a tiny bit of lesser performance. Would you really pay $240 for something that gives "30% better imaging but load times take forever?" I wouldn't. Hell, without my PS3 I'd still be watching things by VHS (fuk yea ) I later also discovered that Sony also had to buy 3rd party materials from other manufactures just to play their PS1 and PS2 games which set them off to about $80. Later, (2008) Sony decides to "up" their game by putting in a HDIDVD display machine in their PS3 which set them off even more. $120 more to be precise.

    So, to sum it up.

    Original PS3 cost: $700
    PS3 cost w/ HDIDVD display: $820

    $820? That's a bit high for a production cost don't you think? Then... Sony makes another jump. The cost it takes to license the formats like MP4 and such off set them by about $30 per PS3.


    Original PS3 cost: $700
    PS3 cost w/ HDIDVD display: $820
    PS3 cost w/ HDIDVD display + licensed cost for video format: $910

    $910... way too high now. Sony has recently announced that they're making price cuts! They're not decreasing the price of their PS3 with all the extra hardware to a cheap price of Sony is forcasting a sale of another 6,000,000 by April. So that would mean about $410 for the low end version.

    ($910 x 6,000,000) [Production cost] - ($410 x 6,000,000) [Estimated Gain]
    5,460,000,000 - 2,460,000,000
    = $3,000,000,000 loss

    Currently, Sony holds about $9 billion. Now, in 3 years they could lose all that if their PS3 doesn't sell well, fast. Currently, Sony is depending on the income of their sold games to make up for the loss. But looking at the fact that PS3 games are $10+ than a 360 game and $20+ than a Wii game things like pretty dismal. Plus, with the added fact that Piracy might also become an issue for the PS3, the games wouldn't sell that well either. With the Wii outselling the PS3 by almost 400,000 a month the market looks strong for Nintendo. Although, there are predictions for the PS3 to pass the 360 in sales. PS3 only tailing the 360 by about 5,000 a month.

    So? Give me your opinion on this, feel free to discuss. I want to know what others think of my theory.
    Last edited by Switchblades; 05-29-2008 at 12:39 AM.
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  2. #2  
    Senior Member PSP Elite Hacker sinphaltimus's Avatar
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    Have you looked closely at the loss MS took over the 360? It was public knowledge that MS was not going to make money on the 360 when it launched, not for a few years. MS and SONY make a lot more than consoles, I don't think the PS3 or Sony are going anywhere soon. When HOME gets released, it will lauch a whole new aspect for the PS3 and PSP integration.

    Let alone the industry response to BluRay over HDDVD. The oprice tag for a PS3 makes it worth it if it were only a BluRay DVD player, but it's not, it's so much more. My PS3 is the multimedia hub for my family. Thousands of digital picture access, our movies and music librarr, all easily accessable. The games, both on disk and downloadable, internet and email (not that we need it with computers but pop a KB and mouse in it and whano, you now have a computer). Dual boot to linux and now you have a better computer.

    The PS3 is a lot more than a gaming console. Sony's biggest problem is that they do not advertise all of its capabilities well enough. There are so many people who own both a PSP and PS# and are clueless of the interconnectivity that exists between them today.

    Sony needs to spend more on TV ads, and they need to show off the non-gaming aspects of it. Everyone knows you can play nice games on it.

    Also, the PS3 is a new development platform - with games just now starting to take full advantage of the units horsepower, I think the dawn of the PS3 in the gaming community is just now begining.

    That's my two cents.

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  3. #3  
    I'm Pitching A Tent PSP Elite Hacker Chriscyco30's Avatar
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    What's this HOME?
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  4. #4  
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    Dude, you need to look at the sales numbers and graphs. The Ps3 is selling just as well as the ps2. The media likes to portray it the other way though because MS has more money to throw around. Sony has met every sales goal for the ps3 so far and its only gong to get better for them once the big games like GoW3, GT5, LBP, KZ2, and a ton of others hit the market.
    Piracy will the the 360 and wii much more than the ps3 too. Everyone has a dvd burner, and blank dvd's are cheap. Not to mention that it only takes a little bit of time to download a dvd game. It would take days on a good connection to download MGS4, then you would have to have a blu-ray burner and disc, both of which will remain rather high in price for a while. Piracy will hit the ps3, but not nearly as much as the 360 and wii.
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  5. #5  
    Junior Member PSP User SportsGuy's Avatar
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    well what is home??
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  6. #6  
    Senior Member I Modded My PSP
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    the 360 doesnt Include a HDDVD Drive, Its Seprate (If you actualy look at the Drive inside the Little Box though, Its designe makes it look like it was Supposed to though)

    But Sony Insnt Gonna go out of Buesness, They make all sorts of Electronics, Plasma tvs, Cd players, Stereos, MP3 Players,

    And Bluray won the Battle, You dont see HDDVD players anymore, both Target, and blockbuster have said they wont stock Hddvd anymore, so thats a Selling point soon too

    I mean look how long DVDs took to become mainstream, and Hell PCs for that matter

    I remember when My Family got its first of both, (Only about 3-4 years ago)


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  7. #7  
    ♥ man ass PSP Elite Hacker carp's Avatar
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    HOME = PS3 version of Secondlife.

    u can share ur movies and music together in ur lil appartment thing, that u get to decorate with stuff, and when the PS3 Trophy thing comes out in the next firmware update (supposedly) u will have a trophy room in it. just think The Sims online with ur PS3 buddies. there has been a beta of HOME going on since like mid last year, and they arent allowed to give any details on it, and everytime they do it gets taken down quickly.
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  8. #8  
    Senior Member PSP Elite Hacker Switchblades's Avatar
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    Sony's electronics department isn't that big. From what I see these days in sales, Samsung and LG still rape the electronic entertainment department.

    Even if the PS3 is selling as well as the PS2, Sony's still losing roughly $400 per PS3. How would they accumulate those losses? By selling games? I'll admit, GoW3, MGS4, and others are great exclusive titles for the PS3. But why would Sony even think about making a KZ2? KZ1 was middle of the road, IGN remarked it as a "alternative choice to spend your Halo money on".

    Also, about HOME. I'm aware of HOME's capabilities but I don't see how that would change the face of the PS3. Share music and videos, why not just do it via streaming? HOME allowing you to share MUSIC AND VIDEOS distributed via the PS3 would cause controversy.
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  9. #9  
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    Well they Do have extra cash to spend, and I dont think there gonna Go bank rupt, You also gotta Add Japan into that, They have PSX there, and some other Sucsesfull ventures that probably wont make it here,

    Not sure about Samsung, but I know LG probably doesnt outsell sony in japan


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  10. #10  
    Senior Member PSP Elite Hacker sinphaltimus's Avatar
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    And lastly dont forget how cheap it is to make PSX and PS2. Then take a look at the hard numbers in PS2 sales to date world wide. The PS2 is reportedly doing phenominal sales in third world nations and new games are still being released for it.

    $400 per unit loss? If this topic really interests you, maybe you should try to get an interview with someone at Sony. Your prediction doesn't hold water. You asked and this is what u got.

    As for HOME - It's more than second life. First off, your sim like avatar walks in to a virtual movie theater and orders up a pay per view on demand flick. It streams right to your TV. Same thing with music. Next, sporting events that have limited penetration will be ordered through the Sony sporting complex, so now peopel can watch those soccer matches in other countries that they can only read about here in the US. HOME will also be the center hub for future on-line multiplayer games. Let alone the virtual arcade where you will hvae tons of games to play by simply walking up to an arcade machine and popping in virtual quarters.

    On top of that, add the secondlife capabilities.

    Then realize that it is a *FREE* service. Granted many of the service (like the sporting and movie and arcade and other consumer outlets) will cost money, but your payting for a product just like you would anywhere else.

    And the music and movie sharing from you virtual apartment? No worries htere because your not distributiong the media. Your streaming it in a way that another person can not save it. No different then playing a cdd for your firend when he comes over for some console gaming.

    A lot of people lie to say - virtual worlds are going to ruin society beause people wont go out anymore. I say Bull55h1t. Over worked and underpaid people don't get out much cause they are too damn tired. This will at least give them a way out virtualy. To see movies and do shopping etc... It's also a lot more secure than doing the same things on a windows based PC.

    And finally, to sum it up, HOME will be accessible (maybe limited but still accessable) via the PSP and other Sony Electronic handheld devices such as PDAs and cell phones. HOME will become the center hb fo everyhting Sony on-line eventually. Sooner or later you might even see PC based web-portals in to certain areas of Home.

    So Home is poised to be much bigger than anyone is anticipating, hence the secrecy and constant delays. Sony needs to get it right prior to release. S ingle major flop and it could cause more damage than good.

    There two more of my cents for ya.
    Last edited by sinphaltimus; 05-29-2008 at 12:41 PM.

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  11. #11  
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    Quote Originally Posted by sinphaltimus View Post
    And lastly dont forget how cheap it is to make PSX and PS2.

    Im talking about the REAL PSX

    PSX is the name of a Sony media center, digital video recorder, and DVD recorder based on the PlayStation 2 video game console. Since it was designed to be a general-function audiovisual device, it was marketed by the main Sony Corporation (whereas Sony Computer Entertainment markets the corporation's specific game-related hardware). It was released in Japan on December 13, 2003. There were plans to release it in other territories in 2004, but in 2005 these plans were postponed indefinitely due to low sales.

    The PSX features either a 160 GB or 250 GB hard drive to record television shows, home movies, digital photos, or to play PlayStation 2 and PlayStation titles. The PSX can be linked with the portable PSP device to transfer videos and music. There is also the indication that the PSX will be linked with the PlayStation 3, meaning that existing PSX owners will not be left out. This could possibly mean that the base version of the PS3 would connect to the PSX to form the “home server” version of the PS3.

    The PSX is also known for its introduction of Sony's XrossMediaBar (XMB) interface which is found in the PSP and the PS3.


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  12. #12  
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    Quote Originally Posted by Switchblades View Post
    Even if the PS3 is selling as well as the PS2, Sony's still losing roughly $400 per PS3. How would they accumulate those losses? By selling games? I'll admit, GoW3, MGS4, and others are great exclusive titles for the PS3. But why would Sony even think about making a KZ2? KZ1 was middle of the road, IGN remarked it as a "alternative choice to spend your Halo money on".
    Sony isnt losing that much on the ps3's anymore. The lastest update they gave was that they are actually very close to breaking even when they sell a ps3. They lost a ton of money when the ps3 was first released due to all the new technology in it, but now they are doing fine.
    It seems like you are getting all of your "facts" from a 2 year old article.
    Btw, Sony isnt making KZ2, Guerrilla Games is. Sony just sells the Dev Kit, what the developers want to do with it is their choice. Have you seen the shots of KZ2 though? Its going to be pretty sweet.
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  13. #13  
    Senior Member PSP Elite Hacker Switchblades's Avatar
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    Quote Originally Posted by Canada2113 View Post
    Have you seen the shots of KZ2 though? Its going to be pretty sweet.
    Screens don't tell anything, FarCry looked amazing in its screens. Turned out; it was utter crap. KZ has never been an above average game and never will be. It's all graphics, no interesting game play elements or anything.

    As for the cost to make a PS3, what have they taken out?

    Edit: Home = Just another streaming site, if companies find something they don't like, they'll take it down.
    Last edited by Switchblades; 05-29-2008 at 03:31 PM.
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  14. #14  
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    Quote Originally Posted by Switchblades View Post
    Screens don't tell anything, FarCry looked amazing in its screens. Turned out; it was utter crap. KZ has never been an above average game and never will be. It's all graphics, no interesting game play elements or anything.
    You seem to be judging KZ2 before it is released too.
    Regardless, its not sony's job to tell Guerrilla what to do. Guerrilla is independent and gets to make their own decisions.
    Quote Originally Posted by Switchblades View Post
    As for the cost to make a PS3, what have they taken out?
    Nothing needs to be taken out for technology to cost less. Due to advancing manufacturing processes certain things become cheaper to produce. Blu-ray drives , the cell, ram... All get cheaper to make as the process is refined. When dvd players were released they were about twice as expensive as they are now, and they new models have more features. Technology gets cheaper to make over time.
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  15. #15  
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    Twice, Dude try like 8-20 times more, I got a great Dvd Player that plays Everthing, its a Phillips and it was $25 Canadian, and Ive seen really cheap ones that were like $10

    FarCry from the $200 the used to be


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