PS3 to sell for $399

Gamespot is reporting that the PS3 will retail for $399. But it will be manufactured for $494. That would mean a loss of over a billion the first year of production.

http//www.gamespot.com/news/2005/06/28/news_6128295.html

Well I guess it should be that same amount of refs then.

read this article
http//arstechnica.com/news.ars/post/20050629-5054.html?63304&93344

Software makers are pissed at the hardware being used in the next-gen systems. Software makers aren't ready to programming using all the threads that the systems are capable of. Basically, they are coming out ahead of their time, at least for software developers.

[quote23350168bd="Peinecone"]Gamespot is reporting that the PS3 will retail for $399. But it will be manufactured for $494. That would mean a loss of over a billion the first year of production.

http//www.gamespot.com/news/2005/06/28/news_6128295.html[/quote23350168bd]

I have my doubts that the there will be a significant "loss". Manufacturers sugested retail price is general 2 to 3 times the cost they charge distributers (stores). Wholesale (the cost charged to the stores) is generally at least 115% of the production costs.

There may be a little loss in the very beginnng for retooling but that will be made up in the second quarter. By the third quarter of the first year (unless sales really suck) they will start to be a little profitable

This could be a ploy to increase demand. "Wow, a large company is willing to take a billion dollar hit to their profits just so I do not get charged a lot." Sound realistic? It reminds me of the chain-letters that claim, "If you forward this to 15 people in the next 30 seconds, [Enter rich person's or large coporation's name] will give you $100."

[quote1dffec6596="Peksim"][quote1dffec6596="Peinecone"]Gamespot is reporting that the PS3 will retail for $399. But it will be manufactured for $494. That would mean a loss of over a billion the first year of production.

http//www.gamespot.com/news/2005/06/28/news_6128295.html[/quote1dffec6596]

I have my doubts that the there will be a "loss". Manufacturers sugested retail price is general 2 to 3 times the cost they charge distributers (stores). Wholesale (the cost charged to the stores) is generally at least 115% of the production caosts.

There may be a little loss in the very beginnng for retooling but that will be made up in the second quarter. By the third quarter of the first year (unless sales really suck) they will start to be a little profitable

This could be a ploy to increase demand. "Wow, a large company is willing to take a billion dollar hit to their profits just so I do not get charged a lot." Sound realistic? It reminds me of the chain-letters that claim, "If you forward this to 15 people in the next 30 seconds, [Enter rich person's or large coporation's name] will give you $100."[/quote1dffec6596]

seriosly, y would sony operate @ a loss?

[quote1a70b86ce3="dudeextrem2000"]
seriosly, y would sony operate @ a loss?[/quote1a70b86ce3]
Because after the 1st year, they will earn a large profit. The price to manufacture goes down and they make most of their mony off licensing games.

[quotead66efa0c6="Peksim"]
I have my doubts that the there will be a significant "loss". Manufacturers sugested retail price is general 2 to 3 times the cost they charge distributers (stores). Wholesale (the cost charged to the stores) is generally at least 115% of the production costs.
[/quotead66efa0c6]
Actually, the newer consoles are always sold below cost. Look up Microsoft's strategy for the xbox and you'll see it reported over and over that MS loses money on each console. I bet the xbox 360 will be no different.

Companies make it back selling $50 titles.

[quote4ce159edee="Peksim"]There may be a little loss in the very beginnng for retooling but that will be made up in the second quarter. By the third quarter of the first year (unless sales really suck) they will start to be a little profitable

This could be a ploy to increase demand. "Wow, a large company is willing to take a billion dollar hit to their profits just so I do not get charged a lot." Sound realistic? It reminds me of the chain-letters that claim, "If you forward this to 15 people in the next 30 seconds, [Enter rich person's or large coporation's name] will give you $100."[/quote4ce159edee]

You have to understand, the "loss" they are referring too is hardware costs only.
The PS3 will still be profitable, but that area of revenue is going to be a loss-leader for the first year AT LEAST.

Hey what happened to your last post peksim? I was replying to it!

Where did you see projections going green for the xbox360 by the third quarter? There is no way they'd make a profit on the console alone...

Usually companies will take a loss the first year so they can gain thier customers. Then thay will make profit within the next year. Sony did this with the PS2 also

[quote7547d06e02]I have my doubts that the there will be a significant "loss". Manufacturers sugested retail price is general 2 to 3 times the cost they charge distributers (stores).[/quote7547d06e02]

eh. i have a friend that works at Circuit City and they buy the Xbox's for 0.30 cheaper than the price they sell them to us for. they make their money on accessories and games.

The gaming world is still so foriegn to me.

Console makers ALWAYS lose money. Why do you think Sega went under?
The way that the other companies like Nintendo, Sony, and Microsoft make money on consoles is by also making software. At least I think that's how it works, I've been out of the console game for a long time.

Yeah... basically the more systems you have out the more games you sell and that's where the real money is. Even games not made by sony or microsoft still have to pay sony and microsoft liscensing fees. People learned their lesson from Atari who lost tons of money when they couldn't make games that were as good as activision etc.

As for the next gen consoles not being developer friendly, I think this is another reason the Nintendo Revolution will be successful. A lot of people will buy it for the free nostalgia. A lot of games will be made for it because of the ease of creation that Nintendo is pushing for.

Almost ALL gaming systems are manufactured at a loss - it's the games that make profit.

It's like the Gillette sensor. They give you the razor handle and one razor for free. Then, you pay an arm and a leg for the refills.

[quotebf186def65="dudeextrem2000"] seriosly, y would sony operate @ a loss?[/quotebf186def65]


Currently Microsoft Looses 100$ (or more) per each xbox sold.

They make that back and then 10fold more thru software sales.

How many times do people have to say this now D Same thing after every post wink