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PlayStation 3 Delayed, Over $800?
AWhiteFlame writes "Cnet is reporting that a research report issued by Merrill Lynch suggests that the Sony PlayStation 3's American release may be postponed until 2007. From the article: 'The analyst firm proposed the idea that high costs and Sony's decision to use an 'ambitious new processor architecture--the Cell' is making it look like the company might not be able to meet its goal of getting the PS3 out in the U.S. this year.' Sony did not immediately respond to a request for comment." The official report (pdf) would also seem to indicate that the console will be somewhere in the neighborhood of $900 when it launches.
a research report issued by Merrill Lynch suggests that the Sony PlayStation 3's American release may be postponed until 2007 [...] The official report (pdf) would also seem to indicate that the console will be somewhere in the neighborhood of $900
Is this the same Merrill Lynch that was accused of lying about the health of corporations such as Worldcom and Enron? The same Merrill Lynch that agreed to pay $100 million in fines? The same Merrill Lynch that may owe several billions of dollars to institutional shareholders and others for gross deception?
Remind me why I, you, or any news outlet for that matter, should have any faith in their statements?
The PS3 may be a loss leader, but there still is a limit. If the manufacturing cost is $900, and sony sells its console at only $500, it means that the company estimates that it can get at get back those $400 in a way or an other.
Given the fact that the usual margin for the console manufacturer on game sales is 20%, that makes only $12 for each $60 game. Simple maths says that in those conditions, sony would have to sell in average more than 30 games per customer to break even on the machines it sold with a so large discount.
And except for the rare hardcore gamer, how many people buy 30 games for a machine in one generation ?