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Sony, Analysts React To PS3 Launch
cdneng2 writes "Sony may be aware that something is just not right. There's a reshuffling of management occurring within Sony. Kazuo Hirai is set to head their videogame unit, as Ken Kutaragi has been bumped to the Sony board. Jack Tretton, former COO for SCEA, is now the president and CEO of that arm of the company. There's no word on the reasoning behind these position shifts. On the same day, Namco announced that they must sell 500,000 games to begin making profit on PS3 games. A Financial Times article confirms speculation on how hard it will be for Sony to make money, as analysts with UBS predict that 30 games must be sold per PS3 for them to break even." To add insult to injury, EA CEO Larry Probst has said PS3 numbers were lower than expected. Current thinking is that Sony managed to ship roughly half of the 400,000 units they were promising.
What are all these posts about how well/bad the PS3 is doing on here? First, we have discussed and read about it twice a day for a week now and second, it is all total BS. We can not and should not be saying anything yet because we dont know anything. It will take months, at the earlier to be able to gage what all three systems are doing in comparison to each other. The 360 is the only system that should have stories like this. This time next year I am all about reading how the PS3 really did bomb and how the Wii sold 60 million units. Right now though, it is retarded.. why? Everything is sold out everywhere the second it gets there. Let the market saturate, supply and demand to even out, give a year of manufacturering costs and shipments numbers to adjust, then we can talk okay?
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A Financial Times article confirms speculation on how hard it will be for Sony to make money, as analysts with UBS predict that 30 games must be sold per PS3 for them to break even."
As much as I would like to poke fun at Sony for this seemingly high mark, they can also make a profit by selling a combination of PS3 games and Blu-Ray movies. It is much more reasonable for someone to have lots of movies than lots of games. Assuming of course the purchase is made at a retail store so Sony gets the profit, rather than a used dealer.
Ken "nutjob" Kutaragi gets promoted? WTF is wrong with them? This guy is a walking PR desaster spewing comments like "we have created the most beautiful thing in the world" in response to the misaligned PSP button sensor issue or "people will want to get a second job to afford a PS3". Their situation is bad enough without rubbing it into people's faces with arrogant comments that show he doesn't even feel bad for screwing up like that.
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It's simple logic: the console that 'wins' will have the most games made to work on it (and I don't mean just backwards-compatible). People don't want a loser, since it'll mean they have decidedly fewer games for later on.
Because this generation requires such a huge investment, people want a decision to be made in the console war quickly enough that they can avoid buying a 'losing' console and wasting their money.
If you can find a way to solve this, let us know.
Given the amount of truely idiotic and genuinely hostile things Sony has done to consumers, they deserve nothing more than utter failure.
Sadly, way too many people have short memories and don't care that computers were scrambled by willfully malicious sony music CDs.
Or the fact that they love to sue music cust^H^H^H^Hpirates into submission. "Don't even have a computer? Give us money anyway cause we KNOW you've been pirating!"
Hell, the last sony laptop I got my hands on, had so much advertising crap on it that it actually *slowed down* the machine significantly, until I uninstalled all of it.
I'm sure I'm forgetting plenty of examples of Sony's heinous, arrogant behaviour.
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Think I'm just going to wait until someone can decide what the criteria are for judging who wins a contest like this before I try and make my predictions. Some thoughts...
Microsoft have had a full year selling the Xbox 360, which overall has undeniably been very succesful. It's online service is highly regarded, and we're now starting to get games which are pushing the console. In all those respects, it's a winner. However, they're still losing money on each unit sold, and they're backing one of two Hi-Def standards, and it may be the loser, but at least they've made it optional, so if it fails it's not going to taint the machine as a games console. If I was a serious gamer, I'd already have an Xbox 360. People know exactly what it can do, and whether they want one or not. Very few people will buy an Xbox 360 and be disappointed, it's already relatively mature and lack of novel user interfaces aside, the others are going to be playing catch-up for the next two years.
No matter what anyone says, Sony have made a phenominal number of mistakes with the PS3. However, many simply boil down to marketing goofs, and a "they'll want what we tell them" attitude which has certainly made them no friends. They're using the console to push other technologies of their own, and that is by far their biggest risk, and also the thing that's likely to keep the component price of the console high for longer. All that said, once the less than stellar launch is forgotten (that'll be around January), there's stock on the shelves, and we start seeing well written games which make use of the phenominally powerful hardware (probably in around a years time), and after whichever price drop brings the high-end console down to around half of its launch price, I'll probably get one. However, I suspect there'll be many people who are disappointed with what the machine achieves within its first 12 months of public life. It's the sort of console that if you owned one you'd want to show it off and shout about. It's a nice looking piece of consumer electronics and there are going to be some impressive looking games, but it's very much like the flash cars you see at shows (you know? The ones that cost more than your house) that you want to just stare at. You'd try and encourage a friend to buy one, so you could go for a spin in it every now and again, but you'd never consider buying it yourself, even if you could afford it.
I'll openly admit however, that my personal enthusiasm is for Nintendo's Wii. But then I'm not a hardcore gamer, and what excites me may well not excite the next man in line. I think the technology is easily good enough to give me games which are visually stunning, that sound good, are innovative (which is something I've come to appreciate more as I get older) and are fun to play. When I get around to buying a Wii in the New Year, I think it's also very likely I'll start getting Virtual Console games on a regular basis, as I'm of an age that I remember them the first time around, and there are a good handful of full games which I'll be looking to pick up when they launch. Nintendo have a good business plan, which all but ignores the other two players. It's practical, manageable, and it also means that they make money every step of the way, instead of losing a lot now, and trying to claw it back over time. The Wii does not set itself against the competition, simply alongside. It doesn't promise the earth, and then struggle to deliver, because all along Nintendo have played down what the machine is capable of and re-itterated that it's all about the games. Until the DS showed how effective that strategy can be, I doubt anyone believed them.
What it should really boil down to is which consoles are of interest to us personally, and that will ultimately depend on which game genres and series appeal to us, and how strongly they are represented on each platform. Let's not forget that the PC is now a very strong gaming platform, much more so than when the last generation of consoles launched, and that will divert some
It's interesting that no-one ever quotes the glowing praise for the PS3 in this isuppli article.
"While many fret over the high cost and price of the PlayStation 3 compared to the competition, iSuppli believes the console provides more processing power and capability than any consumer electronics device in history. Because of this, the PlayStation 3 is a great bargain, well worth its $599 price and $840.35 cost, iSuppli believes."
Of course the PS3 is a bargain, as they are selling it for less than it costs to produce. Hard to call that a bad deal.
Unless you don't have $600. Or the $800-$1000 needed to get one on Ebay if you want a non-hypothetical PS3. "Great deal for what you get" and "way too fucking expensive" are not mutually exclusive!
Nobody buys a console because its internals are architecturally pleasing (don't get me wrong, the Cell is a sweet chip, but that neither makes a PS3 cheaper nor does it make one appear on the store shelves so I can buy it). They buy it because of the games. And right now PS3 is in the same place Xbox was in. What great games did it have? Halo and... um... Halo.
So the reason so few quote the praise for the PS3 is because it's pretty much irrelevent. We're talking about a console launch. Few doubt that the PS3 is, hardware-wise, a very nice piece of machinery. I certainly don't doubt it. That doesn't make me want one, that doesn't mean I can afford one if I did want one, that doesn't mean I could find one to buy if I could afford one, and that doesn't make Sony lose any less money on the purchase if I am finally able to complete it.
It's simple: A console that is very expensive (limiting demand) and is difficult to produce (limiting supply) is headed towards a smaller marketshare, possibly meaning that fewer games are produced for it. As Sony loses a lot of money on each sale and has to sell many games to turn a profit, this means that if it plays out that way not only will PS3 be a failure in the marketshare sense but also in a financial sense. They need to increase the supply and reduce the price before they can attain a marketshare that will keep developers devoted to them, and thus keep consumers devoted.
Notice how whether or not the PS3 is an engineering masterpiece doesn't enter into it? As an engineer I would really like to live in the universe where whoever has the coolest microarchitectures wins, but sadly it doesn't work that way. A lot of times the coolest microarchitecture is the one that fails the hardest because it is difficult to manufacture and thus too expensive and too hard to supply in volume.
Now if the PS3 was a crappy piece of hardware, and still cost $600 with short supplies, then PS3 failure would be a forgone conclusion. However I don't think anyone worth mentioning is saying it's crappy hardware, so I'm not sure what "thesis" you think that part of the isuppli article is contradicting.
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