Sony Probably Going To Do PlayStation 4

Nomura Securities' Yuta Sakurai has been quoted as saying that 'he cannot imagine a PlayStation 4' because of Kaz Hirai's promotion. He sees it as a move (eventually) towards Sega-like software focus. Sony has, of course, immediately denied this because ... they (understandably) like money. From the article: "Following the launch of the PlayStation 3 just a few weeks ago, and witnessing the huge consumer demand for the product, I think it would be rather short-sighted for anyone to predict there might not be a next generation of PlayStation product."

Comments

Oh really?

[0racle]

No shit sherlock. The PS3 would pretty much have to not sell any units before ruling out the PS4 would seem plausible.

Re:Oh really?

[HappySqurriel]

No shit sherlock. The PS3 would pretty much have to not sell any units before ruling out the PS4 would seem plausible.

Well, yes and no ...

Sony's strategy for making money off of a videogame system is drastically different from Nintendo's strategy. Sony makes money because a lot of third parties sell a ton of games on their systems and Sony gets their licencing fee (cut) out of it; Nintendo on the other hand tends to be the number one developer on their own systems by a large margin so they profit through the sales of their own games. For Sony to be really profitable they need to have a very large chunk of the market share so that third party developers have no choice but to develop every game for the Playstation; if they lost enough marketshare that developers were focusing on another platform they would probably be better off leaving the hardware market.

Personally, I don't know the numbers that would require Sony to leave the console market but I suspect if they sold in the Gamecube/XBox range with the PS3 the PS4 might not happen.

Re:Oh really?

[MrAnnoyanceToYou]

Might not happen or might not be profitable? There's a difference. If you're a major multinational corporation, sometimes- out of habit- you spend a few billion dollars. Amusing and sad at the same time.

Re:Oh really?

[ivan256]

It is highly probable that over the lifespan of the PS2, they turned a profit purely on the base hardware alone. In other words the later revisions sold at enough profit to make up for any earlier losses. After that, licensing revenues and accessory sales are pure icing. These are the same economics that Microsoft has to deal with. They would have to do worse than you think to turn away from hardware development. They would have to not only lose exclusives, but lose developers entirely.

Many game companies have lived on licensing fees alone, but none of them have survived that way...

BREAKING NEWS

[C0rinthian]

Console Manufacturer plans to develop, release console.

In other news, Microsoft hopes to sell software in the future.

Why wouldn't they?

[Quiet_Desperation]

The PS3 in the long run will probably turn out to be OK. You learn from your errors and move on. Why does every decision have to be Draconian these days?

Besides, the promised us the nano-dust based PS9 in that commercial.

Re:Why wouldn't they?

[Rayonic]

The PS3 in the long run will probably turn out to be OK.

Oh yeah, in 2 or 3 years the PS3's price will drop to a reasonable amount, allowing mass adoption.

I'm sure most developers will stick around until then, completely loyal to Sony.

Re:Why wouldn't they?

[Rycross]

I think the key with PS2 was that they ramped into it. Backwards compatibility was key to this, since Playstation was still being supported a good while after the PS2 came out thanks to it. So if you're an early adopter, you get your DVD player and next-gen games. Otherwise, your old Playstation still has games (albeit less than before) comming out for it, and when you finally can afford a PS2, all those games you bought work on it.

Thats why I don't think price is as much of an issue as people think. Yeah, its expensive (and I don't think I want to pay $500 for it right now, we'll see in a couple months when its actually available), but my PS2 probably has at least half a year in it before its hard to find new games for it, and even then I can get discount games. It can last me until the PS3 price drops.

And brand is a really strong factor. The Nintendo empire wasn't destroyed in a day. The real key to Playstation dominence was that they expanded the market, like Nintendo is trying to do right now.

Shareholder Report Card

[eldavojohn]

So after keeping up with Sony news on Slashdot, I've learned that on launch they shipped around 150k PS3s and they sold out. I also learned that they lose something like $200-300 per console.

So I guess I figure that they lost around $37 million dollars on that day. So I would imagine that this will look pretty bad on their shareholder report card when their fourth quarter profits for 2006 come out.

Now, they'll make more than that in the future licensing the games. But I doubt they'll make that back before Christmas. So I would suggest holding off on PS4 speculation until the holiday season is over, all the facts are in and the shareholders tell the games division of Sony what to do. In the end, it's not Kaz Hirai or Yuta Sakurai that determine whether or not a PS4 happens, it's the reaction by Wallstreet and the people holding the shares.

Re:Shareholder Report Card

[jonnythan]

The R&D and production costs of the consoles is spread out over a fairly large time frame.

It isn't like they calculate up the costs of building a PS3 and don't count it until they sell it.

"OK, we sold 200k PS3's this quarter, so write down $12 million in the 4th quarter revenue box and $16 million in the expenses box"

Re:Shareholder Report Card

[jandrese]

On the other hand, at only 150k PS3s they have room to sell millions more boxes, preferably after a couple of hardware revisions where the cost of the components (particularly the BD-ROM drive) come way down.

Re:Shareholder Report Card

[DrXym]

The problem with relying on Slashdot for your PS3 news is that Zonk ensures to pick the most negative things to say about the PS3. Why anyone would be that juvenile is not known but it's true.

As to how many consoles they actually sold, you'd have to wait for their stock holders report or when Sony itself chooses to break the silence. They continue to say they'll ship 1 million consoles by end of calendar year so perhaps things aren't as bad as people make out. Personally that sounds rather optimistic, but who knows until they say?

What appears definite is that they sold some 85000 in Japan and probably 200-250000 in the US on launch and must have added to that tally since. EA claimed 200,000 units were sold at launch but do they judge that on how many people bought their games or are they privy to Sony sales figures?

Re:Shareholder Report Card

[be-fan]

The $37m is really chump change compared to the over $1bn spent developing the PS3. Those charges showed up on the earnings reports over the last year or two, so by now most of the losses have been accounted for.

Their investors understand this, because its a very common business model for technology companies. Sony spent over $1bn developing the PS2 as well, and lost money on the first units, but made back multiples of that over the lifetime of the console. Also, any losses they take on the launch are going to be offset by holiday sales of the PS2 (which are still very strong). At this point, PS2 sales are basically free money, since the cost of development was long-ago paid off, and the actual hardware is so cheap to make.

Re:Shareholder Report Card

[brkello]

This is only if you live in some sort of retarded universe where Sony is only making the PS3.

In reality, the PS2 is selling like crazy and so are PS2 games. Shareholders aren't going to see "Sony loses money selling consoles". They will see that Sony's game division is making money hands over fist and that they are positioning themselves to continue to do that for the next generation. Right now Sony is making an investment on the future. Any investment is a gamble and this is a big one for Sony. But there is way too much money in console gaming right now to even think for a second there won't be a PS4.

Market Momentum for the brand

[Captain Kirk]

Sony has not let its buyers down with a console yet.

Everyone who buys a Sony console knows there will be many games for it. With that kind of franchaise amd market mementum, there is no way sony will skip releasing a Paystation 4.

The only question is when will technology that is exciting enough to display the new games be ready?

Re:Market Momentum for the brand

[Rycross]

Its not really a matter of new technology being available. Usually, a console company tries to squeeze 5-6 years out of a console, so that their customers' investment lasts for a while.

The last company that rapid-fire released new consoles and upgrades to try to keep up with the technology curve was Sega, and it basically destroyed their reputation.

It won't be called PS4

[DrXym]

4 is an unlucky number in some Asian countries.

Re:It won't be called PS4

[Mr. Hankey]

In Japanese at least, the on yomi (shi) of the number four is a homonym for death. Probably not the sort of feeling they would want to convey for a new console's launch.

Re:It won't be called PS4

[Hatta]

In Japanese at least, the on yomi (shi) of the number four is a homonym for death. Probably not the sort of feeling they would want to convey for a new console's launch.

I don't know about you, but I'd buy a console called the DeathStation.

Re:It won't be called PS4

[Mr. Hankey]

Perhaps, but the connotation is a bit different in Japanese. It would be more Sony like calling it the MiseryStation here. I'm sure they'll have something, and it'll probably be a PlayStation brand, but they'll likely come up with another way to name it. Maybe PSNext or something to that effect.

Re:PS4: The one with...

[Lord Kano]

Considering the cost of a PS3 on eBay, the PS4 better come with a vagina.

LK

I can't wait for the PlayStation 10!

[GreggBz]

Well, it takes normally 3 crappy consoles to kill a gaming juggernaut. The last one is usually a desperate effort harnessing some completely obtuse miracles of complex technology.

See: Atari 7600, Lynx, Jaguar
See: CD32, Saturn, Dreamcast
See: Amiga 500, 3000, 4000T

With Sony, since they are so diversified, it would probably take at least 7 crappy consoles before the games division tanks.
So, I guess what I'm saying is that the PlayStation X should be friggin spectacular.

Competition is Good

[haddieman]

First off let me just say that I am a Nintendo fanboy and I may have a slight bias against Sony. That being said, I think that the video game industry needs more competition as far as in-home and handheld consoles go. More competition generally leads to a better overall product and that is what drives growth. If Sony does not continue the Playstation line I sure hope they come up with a "new" line of consoles for the good of the industry if nothing else.

Shareholder Report Card irrelevant

[Shadowlore]

Seriously. Sony is such a large company with fingers in so many pies that to expect a significant stock switch based on a quarter in which they launched the PS3 is naive.

xXx State of the Union LOST Sony 60 Million. Did that affect their stock? Nope. Their entire movie studio division posted a net loss of some 65 Million for 2005. Did that affect their stock price? Nope. What did shareholders have to say about that? Not a damned thing.

From Sony's site:

In the year ended March 31, 2006, consolidated sales and operating revenue rose 4.4% from the previous year, to ¥7,475.4 billion. This result was largely attributable to increases in the Game and Financial Services businesses.

At current rates, that's about 64 billion US, with a pre-tax proft of just under 2.5 billion. Do you know how many consoles sold at a $300 loss it would take to make a dent in that? Answer: a lot more than they can make in a quarter. ;)

Dude, you've got to apply some reality to the fantasy. In this case, fantasy loses out. 30 million dollar loss. Not a big deal to a company posting pre-tax profits in the 2.5 billion dollar range. Additionally, they had revenue from the PS3 prior to a single console being sold. Game companies started licensing deals with Sony over a year ago.

Wall Street and shareholders will have no net effective opinion to Sony about the PS3. That is a pro AND con about a company the size of Sony. They can do stuff like the PS3 and not care so much about the shareholders' opinion. Same with MS and the XBOX division which also still loses money on console sales.

You can also look at it anotehr way. One of the deals with the PS3 for Sony is the rapid commoditization of the Cell processor set. While the Gaming division may have funde dmuch of Sony's investment, Gaming will not be the only beneficiary of the Cell. Same is true of the BlueRay component. If you look at strictly Gaming Division numbers, there is likely cause for concern. However, when you factor in the advantages to establishing Blue-Ray as the dominant choice (more licensing), as well as the use of the Cell (and requisite licensing) in computers and multimedia devices as well as who knows where else, Sony would actually be wise to continue this trend. GM, as well as Ford, does the same thing. The C5 Corvette's engine, the LS1, was funded not by the sports car/performance division but by the Truck division. The Truck division moved it's base engine to the LSx design, the Corvette group benefitted. Sony is likely doing this in reverse.

So PS4? Absolutely. The only question is when and what advantages/advancements/improvements over the PS3? Multiple Cells? Large solid state drives instead of spinning hard drives? Obviously they'll keep PS1-3 compatibility, it works so well for them to have that, and to be the ONLY one to say that all prior [platform] games will continue to be usable. Which means it will still had a drive capable of reading them, even if they moved to a non-disc format for some reason. Who knows. I see absolutely nothing to indicate they won't make a PS3 and a PS5.