Close
Report Comment to a Moderator Our Moderators review all comments for abusive and offensive language, and ensure comments are from Verified Users only.
Please report a comment only if you feel it requires our urgent attention.
I understand, report it. Cancel

Finance

Sony not planning on “major loss” with the PlayStation 4

Sony not planning on “major loss” with the PlayStation 4

Fri 10 May 2013 12:34am GMT / 8:34pm EDT / 5:34pm PDT
HardwareFinance

Manufacturing the PS4 will be far cheaper than its predecessor

In an earnings conference call, Sony chief financial officer Masaru Kato (pictured) explained that the PlayStation 4 console will be more profitable at launch than the PlayStation 3. This will lead the next fiscal year's operating income in the PlayStation unit to remain in line with previous years, despite the console transition. The PlayStation 3 was comprised of the proprietary Cell processor and the Blu-Ray drive, which drove up production costs on the system.

"Unlike PS3, we are not planning a major loss to be incurred with the launch of PS4," said Kato. "At the time we developed PS3, we made a lot of in-house investments to develop the Cell chip. Development of the chip saw the silicon processing and all the facilities [as internal investments]. This time, we have a team working on chip development, but we already have existing technology to incorporate. All the facilities will now be invested by our partners, other foundries, so we don't have to make all the investment in-house."

Sony did not provide a sales forecast for the system, which is now based on the x86 AMD Jaguar CPU instead of IBM's PowerPC line, like the Cell. PlayStation 2 sales were removed from the fiscal year 2013 forecast, with Sony expecting to sell 10 million PlayStation 3 consoles.

10 Comments

Adam Campbell Associate Producer, Miniclip Ltd

1,179 967 0.8
Well, I told people the PS4 would be cheaper to manufacture, seemed like a no-brainer with the choice of architecture and a feature such as blu-ray no longer being a premium component. It feeds right into the reason why Sony can potentially launch this console at a significantly lower price than the PS3.

Posted:A year ago

#1

David Radd Senior Editor, IndustryGamers

359 78 0.2
For PS3, they priced the console at $599 for the premium version and they still took a wash in the triple digits for every console. I'm sure before they nailed down what they wanted the PS4 to be on paper, they knew they wanted to avoid that scenario again.

Posted:A year ago

#2

Kevin L. Clark Founder, Editor-In-Chief, Fresh Thinking Media Group, LLC

27 5 0.2
Could anyone see the PS4 at a lower price point than when the PS3 came out?

Posted:A year ago

#3

Jim Webb Executive Editor/Community Director, E-mpire Ltd. Co.

2,270 2,439 1.1
Kevin, I could see them releasing a model at $499 (which was the price of the low end PS3 model at US launch). But I can't envision them going any lower if they are wanting to reduce losses per unit.

Posted:A year ago

#4

Adam Campbell Associate Producer, Miniclip Ltd

1,179 967 0.8
Could anyone see the PS4 at a lower price point than when the PS3 came out?
Why not? Nearly every console in history was cheaper.

Posted:A year ago

#5

Kevin L. Clark Founder, Editor-In-Chief, Fresh Thinking Media Group, LLC

27 5 0.2
$499 seems reasonable. There are still a few questions that only can be answered at E3 (it seems), but the price point is admirable given how much companies are charging for new tech these days. Appreciate the response, Jim.

Posted:A year ago

#6

Kevin L. Clark Founder, Editor-In-Chief, Fresh Thinking Media Group, LLC

27 5 0.2
Good point. I don't even think I remember how much the Dreamcast was when it originally dropped...

Posted:A year ago

#7

Paul Jace Merchandiser

936 1,412 1.5
Sony should also follow Microsoft's lead and look to subsidize atleast one of their PS4 sku's in order to start turning a profit earlier. Because I'm almost certain one of the Next Box sku's will employ this exact same method.

Posted:A year ago

#8

Sandy Lobban Founder and Creative Director, Noise Me Up

315 208 0.7
It'll be interesting to see how much time has been invested in the OS, and what they manage to get together in time. For me that's the key to any price justification, given they are all going for the same architecture. Microsoft have the tech at their disposal to compete with android and iOS in terms of features. I'm not holing out on the PS being as capable as a PC, therefore it has to be cheap to justify its existence, otherwise why would you buy one?

Posted:A year ago

#9

Login or register to post

Take part in the GamesIndustry community

Register now