Sony Shares down 2.75%: Concerns about Blu-ray equiped PS3 (1 Viewer)

[Brian-W]

And, ALL PS3 games are on Blu-Ray media. It's not the Xbox 360 where they are still using DVD technology for games, and HD-DVD (add on) for movies.

Blu-Ray and PS3 go hand in hand - there isn't one without the other in regards to the console.

 

[Austan]

Funniest thing about the article is that it was an financial analyst that made the report... Yet none of the gaming websites/forums reported any overheating issues. With the XBOX360 over heating issue, it was hotly talked about and debated in all the gaming websites/forums. IMHO: with all the bad news surrounding Sony, its a financial analyst job to find the dirt wither it exists or not. It's still not going to stop all the PS3s from selling out from now until Christmas.

 

[Brian-W]

Even funnier (but not for Sony) - it might have been the games that weren't stable (pre-production) and have nothing to do with the console. It's not uncommon, especially for a tradeshow, and especially for a console that hasn't yet released

 

[ppltd]

This is true. It will be very difficult to find a PS3 to purchase this year.

Two quick points:

Most of the overheating issues with the 360 were reported by users after the release of the product.

I am not sure it was a financial analyst that originated the story, but rather used the report to determine the weakness Sony currently has in the market place. It has been serious enough that the major brokers have down graded Sony stock. I know because of my holdings in Sony, and the fact that my broker has already voiced concern over those holding.

Thomas Eisenmann

 

[Austan]

Numbers for Sony will only get worse. If they sell 2 million PS3 at a $300/each loss... It will be -$600,000,000 for their record books... I don't think Blu Ray royalties will off set that.

 

[Jeremy Little]

Oh come on now, Are you trying to tell me that the average PS3 owner isn't going to purchase 25 BD's? Yeah, your probably right.

 

[PeterTHX]

And absolutely NO games, right?

The same BS doom & gloom was said about the 360 last year. It's doing just fine, thank you.

 

[MarekM]

you mean like Toshiba HD-A1 with $200/each loss ???
or did you have any links to that info about $300 loss on PS3 ?!?!

Marek

 

[Jeff(R)]

Some new PS3 info that Phil linked to in the Software section which might interest PS3 fans:

http://www.beyond3d.com/forum/showpo...2&postcount=44

 

[ppltd]

I think the 300.00 ( I have read 225.00 - 250.00, but that was before HDMI on the low end - MS 125 to 150 per unit at launch) guess of loss per PS3 is based on industry analysis. It is probably not far from fact. I personally don't recall what links have the info on the PS3, but a little research into the financial news sources should give you some results. As these numbers a pretty well keep secret by Sony, we probably will never now. Certainly you are not suggesting that Sony is not losing a great deal of money per PS3 they sell. Even MS, using pretty much off the shelve parts in the 360 took a massive loss last year in per unit sales of 360 hardware. We will have a better feel of Sony's losses when they post next years Annual Report. And these losses do not include their R&D. R&D is their investment, subsidy is direct loss.

If Sony sell through all 4.5 million of these systems by the end of their fiscal, the market feeling is it will cost them 750 million to 1.25 billion in direct losses. If they can sell at the same rate of the PS2 (after the launch) this loss is no problem, as they will easily make it back in game royalties. All you need to do is look at past performance, and more recently, MS's numbers.

As far as the Toshiba goes, I don't recall ever reading anything on Toshiba subsidizing the HD players, although it wouldn't surprise me, as this is a fairly common marketing process. Spend money on the front end to get money on the back.

Thomas Eisenmann

As far as the Toshiba issue,

 

[Austan]

There's plenty of sites that state the PS3 loss. I think even the Sony executives admitted to the strategy in game consoles. The same group that broke down the XBOX360 components, broke down the HD A1. And they also agreed the HD A1 was roughly $700-$800. But again this is all speculation and no one will sway their opponents in believing.

Time will settle this debate. If another CE company produces a HD DVD, we will find out the "market price". When Sony releases its earning, we will find out how big of a hit the PS3 was for them. Until then, let the DEBATE continue!!!

 

[Austan]

DDOOUUBBLLEE PPOOSSTT

 

[ppltd]

This is from Fortune back in May, and the numbers are based on components only. Of course, these numbers reflexct the costs 6 months ago.

Thomas Eisenmann

 

[Ryan-G]

Good info there. I wonder how accurate those numbers actually are now though, since it's become evident that both Cell and the diodes are having serious yield problems.

$230 for Cell seems extremely cheap under ideal conditions, we're talking about a cutting edge server grade chip here, $230 is extremely low for that kind of tech. Especially considering it's pretty much a niche chip with no mass market uses outside of PS3.

(Note: I'm not counting the faulty chips IBM is recycling for use in embedded single threaded systems, that's not really use of the processor, it's recovering what losses they can IMO. Those chips are designed for much more intensive uses than the embedded single threaded systems use them for).

As far as the diodes go, with low yields, I'd have to imagine the costs are increased.

I'd also be *extremely* surprised to discover Rambus was selling their memory so cheaply. When it was Intel with their chips they were charging huge amounts, I can't imagine they're selling their cutting edge memory for probably around $100, since the quoted numbers don't count the Nvidia GPU either.

Case fans, ports, joysticks, the GPU, the motherboard, the chipset/logic, etc. Doesn't leave much room for the memory cost, and Rambus is pretty greedy IMO.

I dunno, I'm no expert, but $715 seems awfully cheap to me.

 

[Chris Dugger]

Does it not surprise the group that we are not that far from the PS3 launch and I have seen zero marketing it in any big box retailers...

Dugger

 

[ppltd]

Had not thought of that. There is absolutely no marketing on the PS3 at my local electronics shop. I don't recall when the marketing started on the XBox 360 so I have no way on knowing if the PS3 marketing is running the course of the XB360.

Thomas Eisenmann

 

[Dave Mack]

Ok, whenever people point out that HDdvd players and software sales currently FAR outnumber BD player and software sales numbers all the BD supporters say "Wait until the PS3 comes out!!!!" which should reverse things. So in this case PS3=BD
Now when it looks like there MAY be overheating issues with the PS3 which could severely affect the long term usage of the player, BD supporters are saying PS3 does NOT equal BD...

Isn't this a paradox? If PS3 crashes and burns because of defective units, people getting frustrated and returning them, SONY having to foot the bill for many repeairs, revisions under warranty rules then how will BD survive? With a $1300 Panny player? A $1500 Pioneer? Or a $999 Sony that won't even play CDs? If the PS3 is a smash hit and has minimal problems I can see the BD supporters point but if the article is true, how can anyone logically say, PS3 does not equal BD?!?!?!

Just my 2 cents...

 

[Rob_Walton]

Easy, the sales of HD DVD and BD have been miniscule so far, meaning any lead for either format isn't important. If trends continue into the middle of next year, fine, that would be significant, but what's the likelyhood of that with 5 top name players out for one format vs 1 for the other (and a leveling of the initial price difference). PS3 is just the 200lb guerilla that ensures the support of all the other CE companies, through it's market-growing potential.

 

[ppltd]

As will the 199.99 HD-DVD from MS for the existing XBox 360 base. This will be the absolutly cheapest way to get into HD viewing for existing 360 owners.

Thomas Eisenmann

 

[ChrisMatson]

I agree that the add-on will be the cheapest way for 360 owners to get HD, but I am willing to bet that the PS3 will easily outsell the HD add-on. Sony will sell every PS3 they can make over the next year.