Sony PSP - Pricing Hints Emerge?

Thanks to MCV for their interview with Sony Europe boss Chris Deering, in which it's mentioned again that Sony's PSP handheld "will be launched across the world in the final quarter of 2004." But Deering also talks price, suggesting that the PSP would launch at "closer to 200UKP [369USD] than 300UKP [554USD]" in England. Meanwhile, a Gamesindustry.biz article takes note of "information from Japanese retail sources earlier this week, who told us that a price point around 50,000 Yen [448USD], was being bandied about in Tokyo." Recent exchange-rate changes complicate U.S. launch pricing estimates, though - the PSP will likely launch at less than those raw dollar conversion rates Stateside, but is not intended to be a hardware loss-leader for Sony, with Deering suggesting: "The feeling is that this product should generate profit on hardware alone. We want to make it affordable for publishers to produce a wide range of entertainment and so [Sony-payable] royalties [on software produced for the PSP] will be lower down in the mix this time round."

Comments

damn

[Anonymous Coward]

At those prices, it better have a special suction mode for when I am playing in privacy.

What exchange rates?

[lightspawn]

Recent exchange-rate changes complicate U.S. launch pricing estimates

No, they make things simpler. As a rule of thumb, hardware that costs $100 in the U.S. costs 100 UKP in the U.K.

Re:What exchange rates?

[simoniker]

True - just trying to make the point that you shouldn't necessarily think the PSP is going to cost 560 bucks in the U.S. :)

Re:What exchange rates?

[buffer-overflowed]

But it looks like it's definately going to be over $300. The dollar isn't exactly strong right now, and Sony isn't a US based company. With the current lowest cost trends, I'd be deeply surprised if it wasn't in the $400 range.

It's all but dead in the water at that pricepoint. I just don't see it happening.

Handheld Pricing

[MBCook]

So, what will I buy (price wise)? Let's take a look:

• $0 to $50 - I'll grab it, what's to lose?
• $50 to $100 - I'll look a little harder, but still great
• $100 to $150 - OK, this will take some considering
• $150 to $200 - It better be one hell of a product
• $200 to $250 - And it should include 2 games
• $250 to $350 - And a Gameboy
• $350 to $500 - And a PS 1
• $500 to... - And a girlfirend

I trust Sony a LOT, and I do intend to buy a PSP when they come out, but it costs anything more than $200 they're idiots. You can get a brand new GBA for $60. One of the reasons that many people get GBAs for their kids is that they are $60. Who would buy their 10 year old a $300 portable game system? I wouldn't trust one with something that expensive. If they're smart it will price at about $150, $200 if it includes a good game or two. Anything more than $200 is shooting themselves in the foot.

Of course this is all speculation. Currency conversion, taxes (like I assume VAT is included in the European prices?), and such all factor into the numbers posted in the article. p But in closing, it's one thing to pay $300 for a console, but something like a handheld that can get scratched/lost/soaked in a puddle/stolen/run over with a car/etc. the chances of getting people to pay $300 or more is PATHETIC.

Re:Handheld Pricing

[sladelink]

You can get a brand new GBA for $60. One of the reasons that many people get GBAs for their kids is that they are $60. Who would buy their 10 year old a $300 portable game system? I wouldn't trust one with something that expensive.

Sony is betting on selling the PSP to the market of teens-early 30 somethings, not as a toy for adults to get for their kids. That's what they think GBAs are for.

Re:Handheld Pricing

[MBCook]

I thought about that while writing my post, but I think that the vast majority of the sales of GBAs and GBA games go to kids, so by pricing the system out of the reach of kids you are killing off a large and important market. Just because it's not your target market doesn't mean that you have to bar them from buying your product (which is what a $200 price would do).

And even with the 30 something market, the price still worries me for the drop it/lose it/scratch it/etc reasons I gave in my post. One of the great things about the GBA (in my opinion) is that you don't have to treat it like a Fabrige (sp?) egg or diamond ring. While it's not cheap, it's not hard to replace. Most 30 something would be able to drop $60 for a new GBA if they needed, but how many have $250 or $300 to spend at the drop of a hat if something happens to their PSP?

Re:Handheld Pricing

[Kyouryuu]

$250-$300 is definitely quite expensive for a handheld console. Nokia found that out the hard way by offering a sub-par handheld at an unusually high price. Sony is the one entering a market literally dominated by Nintendo. As the newcomer, it would be arrogant to somehow "expect" that people will flock to it no matter what the price.

And kids are an important factor, no matter what the market strategists say. I can correlate taht - I've seen far more pre-teens and younger playing with Game Boy Advances than people my age and I have a feeling that parents would not be keen on handing a $300 device over to a little kid. Though I might be closed-minded in saying so, it also seems like aiming for the "young adult" crowd is asking for trouble. I have a hard time grasping the notion that the stereotypical games such player enjoy - like survival horror or bloody FPS combat - would translate to a tiny screen very well.

And like you said, longevity is another questionable factor. I've had to replace my GBA once due to a non-functioning shoulder button and while I cringed at paying Nintendo $100 for a glitch in the design (thus rewarding them), it didn't kill me. But a lost $300 PSP?

All I can say is that I hope, at that price, the PSP doesn't take off and usher in a new era of really expensive portables. The leading home consoles can be had for half that price, and I suspect that the next generation of consoles will probably have $300 as a starting point. That said, with its then-ancient PS2 technology, Sony is being quite ambitious and greedy.

Much like Nintendo's arrogant reluctance to accept that Sony is a legitimate threat to the console market, so too is Sony's arrogance that it will single-handedly conquer the market without trouble. Playstation or not behind them, history has shown that Nintendo is a very difficult opponent in the portable market - moreso than in the home console market - and it would be a mistake for Sony to underestimate that.

Re:Handheld Pricing

[Babbster]

I think you're wrong. If the PSP has a good portion of the capability hyped, and obviously if there are good games with the promise of more, there is a large segment of the gaming population who WILL buy it. The idea that people won't spend $200, $300 or more on a portable device has been disproven by the success of the iPod. Further, unless one is afflicted with a serious hand tremor (i.e., Parkinson's and the like), the risk of dropping it with serious damage is minimal unless it's really badly designed.

For me, if the device has good games (new games at PS1-minimum technical quality) and the battery life is decent (8 hours minimum, preferably 10), I'd go for $300-350. The combination of Memory Stick compatibility and MP3 playback will be a nice bonus for those of us who haven't yet taken the portable digital music plunge.

Re:Handheld Pricing

[MMaestro]

I don't think the PSP has any sturdy foundation of first-gen games. Simply reread the Slashdot report.

'... but [it, being the PSP,] is not intended to be a hardware loss-leader for Sony, with Deering suggesting: "The feeling is that this product should generate profit on hardware alone."'

They want to generate profit off of the hardware? I'm sorry, but wtf are they smoking? Do they -really- think that the name brand alone will sell the PSP? Pretty much every video game system, console or handheld, has remained to the tried and true method of 'sell the system at a loss, make a profit on the games.' Even the cell phone companies follow a similar trend by giving out free cell phones, chargers, ear phones, and other accessories. If Sony thinks it can get away with selling the hardware at a profit, they're in for a rude awakening. This is not just another cool MP3 player from Sony, this is a gaming system. As much as Sony exceeded people's expectations with the PS1 and the PS2 (FAR, FAR outdated hardware), the PSP its probably going to teach Sony to not be as cocky.

Re:Handheld Pricing

[Babbster]

What you're describing is conventional wisdom as opposed to the truth. The truth is that Nintendo has claimed that they always profit on their hardware, Sony has said that at worst they have broken even on hardware, and even Sega has only tried to dump hardware when they've been in trouble (see Saturn, see Dreamcast). Only Microsoft with the Xbox has used the true "razor blade" model, and even then they weren't planning on a profit in the current generation.

As far as your comments about the PS1 and PS2, it seems to me that Sony has proven that they know how to fight in the console trenches and produce systems that people want. I think YOU are the one being cocky in assuming that Sony doesn't know what they're doing and is going into the portable gaming arena with blinders on.

In short, just because YOU think that the PSP is too expensive doesn't make it so to others. Frankly, if the PSP meets their lofty performance expectations (near-PS2 quality), they might not be charging ENOUGH compared to the "FAR, FAR outdated hardware" of the GBA.

Re:Handheld Pricing

[Rallion]

I'm not sure anybody's connecting the flaws in this PSP plan. Nobody's grasping the grand connectedness of all the problems.

They're entering a market that's been dominated by Nintendo since the release of Game Boy in 1989. Really, what was the biggest competitor for the Game Boy since it came into existence? Game Gear? Maybe WonderSwan in Japan? Pffft. Game Boy sales are tens of times higher than those two combined.

And they're making it so that it's really only accessible to people in late teens or older.

And Nintendo's fan loyalty is freaking legendary.

And the GBA has some of the greatest games I've ever played, handheld or not.

So, in conclusion, Sony is releasing a product in a field that's virtually monopolized by a company that already has a superior product (initially, and possibly permanently, again, the games are amazing), for about five times the cost of said product, and are targetting the very demographic which is more likely than any other to like this superior, cheaper product, targetting it to the extent of excluding other demographics almost entirely?

Woo! Great job, Sony!

Re:Handheld Pricing

[Dark Paladin]

Actually, I've seen the opposite. Or a parallel Gameboy purchasing evolution.

I've seen quite a few of the penetration testers and other folks I work with whom have to travel picking up a GBA SP for themselves - especially when they see the strategy games they can play. Advance Wars 1 and 2 have sold quite a few games all on their own from what I've seen.

So I agree with you - a lot of them go to kids, but don't be too surprised at the "older crowd" picking up what they might see as an "adult system".

I've already committed myself: if it's $149 and below, I'll get one. Any higher, and I'll wait to get one. (Unless Konami makes a Suikoden I and II remake on one disk - then we'll think about it.)

Easy Decision

[heinousjay]

I'll decide for this one like I decide for every other console. If it looks like there will good games available, then it's mine. I may not get anywhere near launch, though. These things always come down in price, and that will be a factor.

Considering the competition, I would bet this thing will drop precipitously, because the GBA SP will probably be 75 or less when this comes out.

Any word on what will be available? I haven't followed too closely.

Way too much money

[Txiasaeia]

This is just plain too expensive. Fancy graphics aside, who wants to pay $200+USD for a portable console? The GBA is a great platform because it's cheap, backwards compatible, has decent graphics and a TON of great games, also at reasonable prices. I have a feeling that terrific anti-aliased graphics and complex 3D renderings would be lost on a tiny screen, whereas the GBA's cartoon style is perfect for the screen size.

Re:Way too much money

[Kris_J]

Don't forget that the price will go down.

Don't forget that the first week or two of sales will shape the bandwagon that is popular opinion.

Re:Um okay

[ziggles]

The only thing that worries me more than the price of the PSP is the idea that it will just get a bunch of PS1 ports or PS1 style games. I can't think of a single good PS1 game that I think would work well in a portable/handheld environment. It'd be one thing to have 3d games like Mario 64, where everything is brightly colored and fairly obvious.. but most of the good PS1 games are dark and somewhat confusing to navigate on a regular TV, I can't imagine playing on a 3 inch screen. Handheld gaming is the last bastion for 2D gaming, with good reason.

Re:Um okay

[Rallion]

This is just my thinking. Not 'real information.'

Sony is the company that makes consoles with more games than would fit inside the moons of Mars. Games have never been a problem for them, they're the clear winner in quantity, to such a huge margin that it doesn't even matter that (IMO) Nintendo always comes out on top in quality.

But now they suddenly need to keep royalties low? So low that they need to make a profit off the system itself? This implies one of two things, I think:

It's possible that they want to have a library to compete with the impressive GBA offering as soon as possible. This IS, in fact, vital for the PSP to have any degree of success at all. But somehow it doesn't seem likely to be the main reason for it in my mind. For some reason, possibility two seems more likely to me.

They may be having trouble getting developers to put in any decent amount of effort at all. If so, this is going to be a disaster. How can the more expensive system beat the cheaper one with more and better games?

I have no real reason for thinking that the latter possibility is the right one, so don't trust me on that. While I've heard of less companies jumping onto the PSP than I think Sony should be hoping for, I don't follow the news quite religiously, or know what companies AREN'T saying. But it does make me suspicious, and I'd at least pay attention to that if I were you.

What the online article doesn't say...

[Anonymous Coward]

I am a subscriber to the full print version of MCV. The online article is a somewhat condensed version of the interview (print is 2xA3 - 3 = bigger or smaller? I get confused). Gonna copy from the article now:

"We want to make it affordable for publishers to make a very wide range of entertainment and so maybe the royalties will be somewhere lower down in the mix - and we've got to make money somewhere, so the plan is for the PSP hardware to have its own profit stream. I think it will be pitched as a great games machine that does other stuff, but that will be pretty important and impressive other stuff. I don't believe it's a direct competitor to GBA. First of all, it's more like TV picture quality and it's not a direct price point comparison.

There's room for both to be successful and our objective isn't to have any direct affect on GBA or anything else that comes along from them. We want to create a new market with a higher level of resolution and gameplay features that doesn't compete with handhelds or cell phones as previously defined."

And remember, people said Sony wouldn't have a chance against the likes of Nintendo before the Playstation 1 was released...