Slashdot Mirror
How the PS3 Hit $600
Joystiq has up an interesting article today, gathering together information from a couple of places to discuss why the PlayStation 3 is so expensive. From the article: "Kutaragi was demoted after being passed over for the role of CEO and, when former Sony Pictures head Howard Stringer assumed the position, the relationship between the content and technology divisions of Sony became even more intimate. Stringer "quickly dubbed the PlayStation 3 as one of the company's 'champion' products." Kutaragi's desire to stratify the console market with Cell technology in effect wed Sony to the unpalatable prospect of charging an unprecedented price. Coupled with Sony's desire to not only push their own content on HD discs, but to control that medium with their proprietary Blu-ray format, the final price was escalated by two very advanced (and very expensive) pieces of Sony technology."
I really think Blu-ray will bite Sony in the ass. I know a lot of people who will be getting a Nintendo Wii or XBox because of that price.
The number one reason Sony's PS3 is so expensive is because they are not customer based anymore, they are "theory" based.
The DRM Rootkit seemed like a good idea in "theory".
A $600 game system seems like a good idea in "theory".
In theory I'm not going to buy the PS3, and neither will billions of other humans because of the price.
Oh You POS
I'm really scared for the PS3. I remember reading a recent comment on /. earlier about Sony's last-minute motion-senseing controller reeking of upper management mandating that said feature go into the product. I have a feeling that this same upper management is going to severely harm what was once a pretty sweet console.
-- n
Information collected from RooKit Marketing suggested gamers were willing to pay that much.
Let's face it, they've figured out that without a girlfriend, we've got money to burn.
Wanna fight ? Bend over, stick your head up your ass, and fight for air.
From Wikipedia also:
"Proprietary software is software that has restrictions on using and copying it, usually enforced by a proprietor. The prevention of use, copying, or modification can be achieved by legal or technical means. Technical means include releasing machine-readable binaries only, and withholding the human-readable source code. Legal means can involve software licensing, copyright and patent law."
Just because a bunch of companies get together a support a format doesn't mean that format is not proprietary. Is it open? Is it controlled by a common standards body? Can a reader/writer of the format be created by anyone for free?
Not so non-proprietary now, is it?
Developers: We can use your help.
I have inside information from Sony Electronic Entertainment (posting anonymously for obvious reasons) that yields on some of the components like the graphics chip and Blu-Ray controller chipset are as low as 20-30%. In conjunction with those being new and revolutionary technologies only manufactured in a handful of factories in southeast Asia will no doubt contribute to the $649 price point. Oops, did I just reveal something I shouldn't have? ;)
Again... because its technology is too cutting edge and too new and therefore too expensive, would have been much better to go with cheap commodity stuff rather than daring to push the boundaries and actually put some THOUGHT into the product.
But what got me most was this
Coupled with Sony's desire to not only push their own content on HD discs, but to control that medium with their proprietary Blu-ray format.
If the PS3 gets reasonable marketshare then this could be considered its master stroke in 2 years time. While the XBox 360 will need a revision to support HD discs, the PS3 won't.
But what irritates me most is the phrase "their proprietary Blu-ray format". I must have missed the bit where the MS Supported HD-DVD was an open standard with no strings attached. So Sony created an HD disc standard, just like they worked with Phillips on CDs and have created several other professional and consumer format standards, some which flew, some which didn't.
Its a sad state of affairs when Slashdot articles don't even celebrate the invention and the investment, but bitch just about the price and want LESS gadgets in the box, and when the MS supported standard is implicitly suggested to be a more "open" option.
An Eye for an Eye will make the whole world blind - Gandhi
The game (and music and movie) industry is bizarre, deal with it. If the PS3 is fun and gets a sexy reputation, then people will buy it. If people think it's lame, then they won't buy it. I don't think the price has very much influence.
For me, the fact that they added "motion sensing" at the last minute sounds much more worrying for Sony. It sounds like they realized the Wii was going to beat the PS3 and they had to copy it. I think I will get a Wii, not because it's cheap, but because the controller has great potential for fun gameplay.
Sony is really heading into a direction that may land them back in the current generation. The PS2 is still going strong, the only reason that next gen systems are so quickly adopted is because their predicessors are so quickly dropped. It wouldn't surprise me if, after an extremely terrible launch, Sony's only option is to continue with the PS2 for another couple of years. I think that the PS2 could easilly take on the 360 in the next generation, not in power, of course, but in how entrenched the software framework is. Many developers will, obviously, jump ship and opt for the most powerful system. But depending upon the success of the Wii (which, unless the big N makes any huge mistakes, is looking pretty positive), this next generation may turn out to not be about horsepower at all, but about innovative game design. As much as I love the concept of the Wii, it doesn't require having a new gadget to be innovative, Katamari taught us that pretty directly. Sony doesn't make any money on their consoles, they'd probably be more than happy if they could continue selling current-gen games at the same rate as they have been, since licensing is where the money comes from. The dirth of so many great last minute PS2 games may insure the success of the PS2 for a while yet to come. It may be that Sony is planning on a slow adoption rate, and a slow drop in price until the system can really take off in 2 or 3 years.
I'm sorry, I'm still diggin Dragon Quest 8 so much, I'm not sure I really see the need for a generational change in horsepower. Nintendo "gets it", the Wii is only about twice as powerful as the XBox, yet is looking to sell like hotcakes.
Thing is, I'm 25, I have a decent professional job (as a TV commercial producer), and I love the games the Playstation line has given us, yet even I can't justify $600 for a next gen console. If people in my position aren't going to buy it, who will? I think the writing is already on the wall for the PS3, at least for the moment.
Multiplayer Gaming (defined): Sitting around, discussing single-player games with my friends, at the bar.
What percentage of people actually use their consoles as a primary movie player? Electronics manufacturers are always dreaming of using convergence as a way to take over the world, but the reality is people are used to spending ~$200 or less on a DVD player, it won't take long for HD players to reach that sort of price range, and the ability of a console to play HD disks will be irrelevant to most people. Can't really see it being seen as a "masterstroke".
Doesn't change the fact that the format war does nothing for the consumer whatsoever, hence the pointed tone about proprietary format. The same tone would be taken with HD-DVD, the point is the consumer gets f@#ked again.
Oh no... it's the future.
Sorry, but you don't know what "proprietary" means. Proprietary means that the format is owned by someone, which it is. The fact that a bunch of big companies got together and formed an association doesn't change that fact.
proprietary
adj.
1. Of, relating to, or suggestive of a proprietor or to proprietors as a group: had proprietary rights; behaved with a proprietary air in his friend's house.
2. Exclusively owned; private: a proprietary hospital.
3. Owned by a private individual or corporation under a trademark or patent: a proprietary drug.
It all depends on which definition you're using. You are assuming definition #3. But it seems clear from the context that the article itself (written by Joystiq?) is using definition #2.
The point is Blu-Ray is no more proprietary than HD-DVD or even regular DVD. The fact that Joystiq used the word at all is implying that Blu-Ray is somehow proprietary in a way that those other formats are not. Otherwise, there'd be no reason to describe it in that manner - I mean the Xbox 360 is using the "proprietary" DVD format and it only costs $300-$400. So this is not a differential between these two systems, and implying that it is is at best biased reporting and at worst just plain incorrect.
It is almost definitely true that the BD drive is one reason why the PS3 is so expensive, but that's just because it's new technology. It's got nothing to do with it being proprietary or not.
Just set a price. A DECENT price. $400.
Then say "the first two shipments will be sold all on eBay by us. Bidding starts now."
The fanboys and early adopters who are willing to shell out will drive all the systems up to $900 or more. Sony will sell 'em all, they'll make a profit (surely PS3s don't cost THAT much to make), and those of us who will wait for a more reasonable price will get it later.
Instead, they're charging EVERYONE $600. They will sell fewer to "normal" people, and they won't get any of those insane profit margins that eBaying the first two shippment would get them. Sony is worse off, the average joe is worse off.
It's simple economics. If you have a hot product, why fuss with stores and go straight to a market decided price (with a minimum, of course) by eBaying them for a while. I'm sure eBay would cut you a huge deal on the auction.
Heck, you're Sony. You can auction them yourself off your site.
But instead of charging $400 and getting tons of proffit from the people willing to pay $1500, you're charging $600 and getting a large loss.
Genius.
Comment forecast: Bits of genius surrounded by a sea of mediocrity.
What percentage of people actually use their consoles as a primary movie player?
People who don't want to buy two? Students? No idea, I just know that we coped for several years with a PS2 as the DVD player.
Doesn't change the fact that the format war does nothing for the consumer whatsoever, hence the pointed tone about proprietary format. The same tone would be taken with HD-DVD, the point is the consumer gets f@#ked again.
So what should Sony be doing, trying to get a large industry group behind their standard to help it.... oh hang on they are doing that... how about trying to use a non-proprietary (not yet Open Source) technology such as Java for the interactivity bits... oh hang on they are doing that.
Let's put it this way. If Microsoft, who had an open choice like Intel, had backed Blu-Ray... do you seriously think there would still be a discussion? Can you think of a SINGLE technical reason to back HD-DVD over Blu-ray if you were Microsoft making that decision, BEYOND considering Sony to be competition?
It isn't the same, and it isn't right to say that consumers always get fucked by these standards wars, often they lead to decent competition that drives the price down, and either leads to a dominant standard (VHS v Betamax) or total compatibility (DVD-R+R etc etc). Monopolar approaches tend to work in markets with lots of standards that need to agree(e.g. WiFi with 802.11x).
Microsoft pushing HD-DVD isn't the same as Sony pushing Blu-ray, one company put energy and investment into inventing and creating something, the other made a political decision.
An Eye for an Eye will make the whole world blind - Gandhi
Does any game developer need a BR disc to provide a gameplaying experience that right now they can't fit on a DVD-9? Exactly what groundbreaking new gameplay paradigms are they introducing with the PS3?
Just a glance at the PS3 release schedule on IGN (or other sites) doesn't fill me with the desire to open my wallet to experience TeH aweSome. Turok? NHL 2K7? Sonic? WWE Smackdown? NBA 2K7? Rainbow Six? Madden NFL 07? It looks like the same old piss in a new hi-res bottle. And as much as I want to play MGS4, I'm not going to pay the better part of £500 to do so, no matter what resolution I can now watch Stealth in as a side benefit.
You must think in Russian.
In this sense DVD, HD-DVD, and Blu-Ray are all proprietary. While from the perspective of a programmer or a Linux user DVD absolutely is proprietary, when we talk about things like consumer video formats "propreitary" does not in common parlance mean the same thing as if we were talking about a .DOC file. Consumer electronics standards and software standards are quite different contexts.
Being "owned" is not the same as being propreitary. MP3 is similarly controlled by a commonly licensed patent pool, but nobody tries to pretend Mp3 is propreitary.
By claiming Blu-Ray is "proprietary" in the fashion the article does, it is implying this is something special about Blu-Ray, some quality that HD-DVD and DVD do not share. This is at best misleading and at worst a lie, since Blu-Ray is identical in this respect to other formats.
You're wrong, and the moderators are only moderating you up and the other guy down because they hate Sony and will reward anyone who can make them look bad, whether they're right or not.
When first adopters are accustomed to spending $300 for a console launch (later adopters get it at the $150-$200 price point), $600 is quite a lot. Double, in fact. As for the price of a TV,
Then again, most early adopters will already have an HDTV, so they're not factoring that price into the equation. A $200 difference is a lot when you're comparing $400 to $600.
Not necessarily true. Aside from the fact that there are games on 360 that you simply can't play on Xbox or PS2 (like Oblivion or PGR3), just because you don't have HD doesn't mean you won't benefit from the newer system's extra horsepower. More actors on screen, more particle effects, better physics and AI, better frame rates (especially imporant in racing games -- PGR3 on 360 at 60fps is much smoother than Forza on Xbox at 30fps), etc. Sure, you don't get the benefit of higher resolution textures, and you may have to sacrifice some vertical resolution for letterboxing, but outside of first-person shooters where pixel-level accuracy counts you're not going to miss it all that much.
You miss the entire point.
Both PS3 and XBOX 360 are going after a shrinking market. There just aren't that many people out there who give a rats ass about either of them; the gaming market has gotten more and more narrow.
Normal people don't spend $400-700 on a video game console with a game or two. That's enough to buy a fully-loaded PC. And let's not forget the $60 games they expect you to continue to buy to go along with it, many of which suck and you feel like a big chump for spending your hard earned dollars on it.
Budgets on these games keep going up, they get more convoluted (not specificly complex), the control schemes are so whacked that it takes 10 hours to figure out just how to play some of them, and so many are simply rehashes of each other with pretty new skins. The audience for these titles is dwindling, not growing.
And among those that do want it, the easy-to-impress-with-pretty-things 12-17 year old market, they won't even be able to afford it. "Gee, Mom and Dad, can I have a $600 game system for Christmas? Oh, and I'll need a few $60 games too!" I don't know many kids in that age bracket that aren't from wealthy families who can save up that much cash from their after-school jobs.
People want fun, easy to play, but hard to master, games. Sony and MS are going after their shrinking audience, and the rest of the world is waiting for something like the Wii, which will be affordable, accessable, innovative, and it looks like will have some hella fun games.
Let Sony and MS fight over the dwindling "hardcore" market, and watch as Wii sells numbers that neither company can possibly imagine. Hell, even my parents want one - and they haven't touched a console since the NES let them play DuckHunt. I'm no Nintendo apologist, but I've got to tell you this time it really looks like their innovation is going to pay off.
AE
Yes, though I don't have much extra income right now, I could "dig up $600 for a console" if it was that important to me. But you're kind of presenting it as this all-or-nothing thing -- "this is how much entertainment you get, it is worth $600." Well, maybe. I'm actually inclined to say no, since you didn't factor the overpriced games into your hourly estimate, but it doesn't matter. In deciding to spend $600, I don't pretend that this is some segmented portion of my life and ask whether the entertainment justifies the expenditure -- I compare the entertainment I would get from the console to every other way I could possibly spend $600. Such as on an X-Box 360 and some games, or a Wii and even more games, or hell, a used PS2 and a box full of old games. Each of those choices would give me a better hourly entertainment rate than your "buy a PS3 because you can technically afford it" scheme.
Maybe a console would be worth $600 if that was the only option, but considering the many alternative ways to spend my $600 + $70 every month or two, many of which have as much or more longevity than most consoles, I'm going to pass.
(I am thinking about getting a Wii, though. I haven't bought a console since the SNES generation, but $200 for a system focused on actual entertainment, with plenty of downloadable nostalgia factor, is about my speed.)
I am the man with no sig!
Can you think of a SINGLE technical reason to back HD-DVD over Blu-ray if you were Microsoft making that decision, BEYOND considering Sony to be competition?
I can think of a few off the top of my head:
1) HD-DVD drives are less expensive
2) HD-DVD has a mandatory managed copy requirement
3) HD-DVD doesn't have region coding
4) HD-DVD discs are less expensive to produce
5) HD-DVD discs can be produced with DVD9 content on one side and HD-DVD content on the other (ie: good upgrade story)
6) HD-DVD discs are more fault tolerant than blu-ray
7) Hi-def Movies don't need more than 25 of storage space with modern codecs
Another thing this article left out - the ballooning price of PS3 is also the result of ballooned R&D costs due to design incompetence and failure.
The original PS3 design called for 3 Cell processors and no GPU. Each Cell CPU was to have 1 logic unit and 8 SPE's, and graphics would be done in software mode. Sony ended up with egg on their face and had to run to nVidia to bail them out.
Originally nVidia was called in for "consultation" purposes, and both parties denied a GPU was in the works. But inevitably, Sony's lakluster design forced them to purchase nVidia's PC GPU to overcome the Cells graphical inability. Turning to nVidia costed Sony much more than they planned to spend, and buying the PC GPU's costed them even more.
To add insult to injury, low yields forced Sony to cut the SPE's down to 7 operational SPE's per Cell, and costs forced them to cut 2 Cell processors away completely. Now we have an over-engineered, overpriced, and underwheliming architecture. Don't let Soy's infalted numbers fool you, the X360 was brilliantly designed, PS3 was botched, so for all the hype and price, you pay 2x the money for the same quality system, and Sony loses assloads of money. It's a lose-lose situation for everyone (except nVidia, who will walk away from this with a really fat bank account.)
I think they could have phrased that more tastefully.
GCHQ Quantum Insert installed. If only our tongues were made of glass, how much more careful we would be when we speak
Please don't start this bullshit again. This argument is based on an entirely specious argument, that vinyl is supposedly "analog" while CDs are "digital". Well, repeat after me: "THE UNIVERSE IS QUANTIZED".
Vinyl records are made of individual molecules, the pick-up stylus is made of individual carbon atoms, electric current is carried by individual electrons. The final consequence of this is noise. Any good electrical or electronics engineering curriculum will have a course on probabilistic modelling where you learn how to calculate the noise resulting from the discretization of electric charge.
When the CD standard was created, one simple question was made: which level of quantization noise in the encoding will be low enough to be irrelevant, considering other sources of noise and distortion?
I have a Shure V15 type 4 cartridge, which was near to the top of the line in vinyl reproduction technology when I bought it. I don't remember the exact specs for it, but the distortion value was something around 1%, excellent compared to other models, but just terrible if compared to digital technology. If you take a look at the specs for the newest cartriges from Shure you'll see the don't even mention specs for things like distortion or noise. Try to google for distortion specs on audio cartridges, can you find any that comes close to CD quality in fidelity? It's hard to find anyone that actually gives measured specs for noise and distortion, they just say it's "amazingly low" or similar marketese.
If there is any objection to CD quality, perhaps it's that it's too good. Most people are satisfied by the inferior specs of mp3. However only ignorant people, based on faulty reasoning, would believe that something is better just because it's labeled "analog" instead of "digital".
OTOH, I agree with you on what you say about lossy video encoding. But that's not a result of being digital, it's a result of compression. In the analog world, 8 mm film has lower quality than 35 mm film, is that so surprising? Put enough lines in the video, use a better encoding, and the artifacts will disappear.
Differently from CD audio, digital video today doesn't have standards that comply with the best possible quality, because the needed data volume is too big for current technology. Color depth of 8 bits per channel are insufficient, the human eye can see much more than 256 levels of any color. The eye has a variable resolution, but the video cannot count on that. Since you can look at any detail with the best part of your eye, a perfect video encoding should have each part of the scene encoded at the best resolution of the human eye.
A digital video standard designed like CD audio was specified, to comply with the full sensitivity of human eyes, would be something like 16 bits resolution for each primary color, 30 frames per second, 4800x2400 pixels. Without compression, that's 2 Gigabytes / second.