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

Ryan-G

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I don't know about that. Two factors seriously impede PS3's adoption, which lead to a third, probably fatal, factor.

First, The pricing of the PS3. Even down to $450 for the base unit, PS3 is ridiculously expensive. Once you're done adding in games and an extra controller, you're looking around $600 just to buy in. Go to the second tier of console and you're around $800. Laptops cost less than this. One of the driving factors for Consoles over PC's is cost, and PS3 is well over the limit. At this price point, PS3's viability is subject to factor 2.

Factor 2 is the games. Games sell consoles, No one buys a console as a decoration. Since it's all in the games, and the PS3 is prohibitively expensive to purchase on the promise of games, PS3's sales will be driven almost entirely by the number and quality of their games. This is where we run into the biggest problem. The vast majority of PS3 games are available on X-box 360 and/or the PC. There are only a very few titles that are exclusive to Sony, and only 2 or 3 of which can be considered A++ titles(Grand Turismo, Metal Gear, Final Fantasy). Given the price point, it's highly unlikely alot of people will be able to justify an ~$600-800 buy-in for only 2 titles that can't be found anywhere else. Alot of people will hit "Wait and see" mode.

Which leads to the fatal factor. If PS3 is prohibitively expensive to the vast majority of the market, and remember the middle class is a minority now, and there aren't a significant number of exclusive A++ titles, sales will be slow. If sales are slow, Studios get a message, the message being that it's more cost effective to develop for competiting platforms than it is PS3.

As such, it becomes a self-destructive cycle. The less console sales there are, the less games that are made, the less people are inclined to purchase the console.

There are other factors which are going to seriously impact PS3's adoption rate as well, limited supply of Cell, hardware failure of Cell, and overheating. Sony's going to be doing replacements on alot of their units, which is going to further limit supply.

Name does not sell consoles. Games sell consoles. At the price they're asking, the deciding factor is going to be the games, and Sony's pretty weak on that front.

Will Sony sell every launch box they make? Most certainly. Will Sony sell every unit they make for the next year as soon as it hits the shelf? Highly unlikely. Most people simply don't drop >$600 without something tangible to show for it, and Sony just doesn't have anything to show.

As a final note, as a reference...

http://www.gamespot.com/games.html?t...dir=asc&page=0

The bulk of the PS3 games don't even have release dates yet, and out of the remainder, the majority are very spread throughout 2007. Not a good sign, the whole thing made worse by virtue of the fact that two of the A++ tiles(Final Fantasy and GT) lack solid release dates.
 

ppltd

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My guess is the MS will sell every HD add on it can manufacture for the next year. Supply will not keep up with demand for quite some time.

By the time it does, we should see stand alone BD and HD-DVD players in the 250 price range.

Thomas Eisenmann
 

PeterTHX

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Ryan, each and every point you made was said about the XBOX 360 a year ago, just take $100 off your figures. Especially after the lackluster launch lineup was announced. "Call of Duty 2" and "PGR 3" were great games but not killer apps. Matter of fact, the one killer app for the Japanese market was "DOA4" and that was delayed...the 360 is a non-factor in Japan now.

Time has been kind and the 360 is a success here in North America. I see the same exact thing happening for the PS3 but in greater numbers due to folks being able to buy HD films when the game software choices are thin.
 

Austan

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"PS3 vs XBOX360" is independent of "Blu Ray vs HD DVD" !!! HD DVD is independent of "XBOX360"... "Blu Ray" is dependent on PS3...

PS3 requires the same key components of the Blu Ray format, lasers and discs. Millions of PS3 consoles will be made, tens of millions of games for PS3 will be made. If Sony sells 2 millions PS3 by end of year and each gamer buys 3 games, that's 6 million Blu Ray discs needed not to mention the 2 million lasers.

6 million XBOX360 sold does not translate into 18 million HD DVD disc nor does it translate into 6 million HD DVD lasers. How many HT early adaptors have a XBOX360? If you do not currently own a XBOX360, it will still cost you at least $500 to watch HD DVDs. So why would a HT early adaptor choose that over the HD A1 which can be had for $399? Why would a gamer put out another $200 to watch a movie when they can buy 4 new games? The XBOX360 external HD DVD player is such a niche product and it doesn't even support HDMI.
 

Rob_Walton

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In that sense PS3 is more closely linked to BD than the 360 is linked to HD DVD, but it's an entirely positive link. As more discs are produced the cost to create each disc drops, so the large number needed for PS3 will help to cut costs for general BD movie disc production. The cost of blue diodes will probably rise but then that effects both formats equally.

BTW I'm back at uni now, and haven't met a single gamer who doesn't also watch movies. The guys in my dorm are using a slimline PS2 as a DVD player.
 

ppltd

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With that logic, why would a consumer buy the PS3 when they can but the 360 for 200.00 less and buy 4 games. And of course it is a niche product, but it is a product that has the potential of selling millions of units. And it lessens the impact the PS3 will have on BD.

Thomas Eisenmann
 

Chris Dugger

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Again....

If the PS3 doesn't get it's launch here in the USA soon, BluRay will have a very soft Xmas....

We are just over a month out from the PS3 launch date.... and even the gamespot site mentioned earlier says nothing about how to get a PS3.

It's like all the retailers aren't sure what they are going to do or if they are even going to get something to sell.

Dugger
 

Cheech

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Considering how badly BD is getting destroyed by HD-DVD sales right now, I don't know how you can say that. If the PS3 isn't BD's white knight, what is?
 

Austan

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Because of PS3 and the millions of key components it uses with Blu Ray, it the driving force for mass production and mass production = lowering prices. Blu Ray out the gate was a more expensive technology. But the BDA also said that with mass production it could reduce cost. Without PS3, production numbers would be in the 10 thousands maybe 100 thousands. With PS3 its now in the millions. It's a direct dependance of BD on PS3.
"PS3 vs XBOX360" is independent of "Blu Ray vs HD DVD" !!! The consoles will sell itself. Over 110 million PS2 sold is a nice fan base. Another example: Ipod is the top brand and rather expensive mp3 player. There are cheaper players with more technology but you can't stop Ipod sales just like you can't stop PS3 sales...

The impact of PS3 has already happened to BD. All lasers are being hoarded by Sony and BD discs are being mass produced. Sony will easily sell millions of PS3 regardless of 360 sales. 360 sales and Wii sales will only effect the total sold, not the initial sales figures. PlayStation has a huge fan base and they are hungry for more.
 

ppltd

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The quantity of current owners does not make mainstream. It is the product and price point. Both the PS3, through the fact that every manufactured console will sell out, and the HD add-on for the same reason brings this product out of early adopter and into the mainstream. These devices will be in every Toys'R'Us and department store across the country. At that point, we early adapters become irrelevant.

Thomas Eisenmann
 

Austan

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I think you have a very different definition of "mainstream" and "early adapters".
 

ppltd

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The PS3 is not an early adopter platform. It is not a risk, nor can it be considered a new technology platform, and will be targeted to the general public. Ditto for the HD-DVD add-on from MS.

Thomas Eisenmann
 

Shawn Perron

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Looking at the history of video game system "ad ons", you can only anticipate that the HD-DVD "add on" is destined to end badly. The Sega cd, Sega 32x, turbo graphix 16 cd, N64 ram expansion, PS2 hard drive, N64 broadband/dial up adapters and a few other add ons all failed miserably. In fact there has never been a successful add on released for a console. When you also take into consideration the fact that no games will be taking advantage of this HD-DVD peripheral, it begins to look even worse. At a price of $200, the HD-DVD add on is equivelent to purchasing 3-4 new games which will be a big deal among the people that already own the console to play games. With a HD-DVD set top selling for $399-$499, a total of $499-$599 for the 360+add on doesn't seem very appealing unless you are primarily a gamer to start with.
 

Dave Mack

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I actually bought both the Sega CD and the 32X...
They are both sitting in a closet at my mom's house 3000 miles away. I hear ya about that. The Bram Stoker's Dracula game for Sega CD was pretty cool though...

:)
 

Austan

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Early Adopter having nothing to do with a platform or risk. "Early adopters tend to buy or try out new hardware items and programs, and new versions of existing programs, sooner than most of their peers."
 

ppltd

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The comparison doesn't hold. All of the add-on CD's were for game play. The publishers would not support them because not every console owner would have one, so these add-ons experienced an appropriate death.

The fact that no games will take advantage of this drive makes it more likely to suceed for the above reason. It is being marketed focusing on current owners that want to get into HD movie viewing. It is not being marketed as a video game system add-on. This is an important distinction. And again, with the install base MS currently has, the early expectaions are that 10 - 15 % of the current owners will buy. If those conservative numbers hold up, it will put an additional 1 to 1.5 mil HD players into the market. Certainly not what Sony will end up with, but in a numbers game, 1 million HD players specifically for movies will be hard for the current Blu-Ray only studios to ignore.

Because we are talking about current 360 owners, an investment of only 200.00 is what we are talking about.

With the rational you use on pricing, there should be no PS3's selling, because you will be spending 499.99 at a minimum to get out the door. No money left for games or monitor. For current 360 owners, for the price of a PS3 they can buy their 200.00 HD add-on, and have 300.00 left for movies and games.

Thomas Eisenmann
 

Brian-W

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I'd like to live in a world where that math worked...

X360 = $299 ($399 for the 20GB HD & wireless controller loaded version)
HD-DVD add on = $199

Total $498 for the basic X360, no hard drive or wireless controller
Total $598 for the X360 w/HDD & wireless controller

Now....

PS3 w/Blu-Ray and 20GB HDD $499
PS3 w/Blu-Ray, 60 GB HDD, and wireless controller $599

The price advantage for the low end box goes to Sony, which includes the movie player and a HDD. The high end still goes to Sony, because with pricing, you get a bigger HDD. Did I mention the HDMI 1.3 port on both machines?

In the end, games (quantity, quality) will sell the PS3 or sink it. But the movie comparison given above, there is no imaginary $300 that an Xbox user can spend that a PS3 owner won't - in the end, similarily equiped game boxes cost the same.
 

ppltd

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Read the quote you copied from my post. It states clearly that I am talking about existing 360 owners. It was an entirely different story with new buyers. The math is right.

Thomas Eisenmann
 

ppltd

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I think you missed my point. The first buyers of the PS3 and the HD add-on will not be early adopters, just average consumers. I will grant the opening day sales will go to gamming fanatics, as most people, including early adopters, will not wait in line over night for anything. These lucky few are no different then the group that will stand in line for concert tickets. Again, with the release of these two products, BR and HD become mainstream.

Thomas Eisenmann
 

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