Comments on: Why Sony needs to (but can't) drop the price of the PS3

iSuppli breaks down the Playstation 3 and sees cost savings for Sony. But even still, can Sony drop the price of the console to compete against cheaper alternatives?

[steve3717]

You hit the nail on the head. A lot of consumers can stomach the idea of putting off or delaying some features (Blu-ray, wireless network) to save money now, knowing that they'll need to pay for them later. I understand that Sony is giving a huge discount for all the features packed into the PS3, but the up-front cost is going to block them from gaining (or even holding ground) on market share. They're stuck between a rock and a hard place.
I don't plan on picking one up until it breaks the $200 barrier. I know that's a couple of years out, but that'll be around the time they stop offering movies on standard DVD and I'll need a Blu-ray player. Of course if stand-alone players are < $100 by then, I'll probably skip the PS3 altogether.

[Real23]

You'll be waiting more than a couple of years for that $200 barrier.

[kswa1987]

very interesting article, i totally agree... with the new isuppli report it is abundantly obvious.

as we all know it is not always the "best" technology that wins the war, but what the consumers want. and microsoft has given them what they want (and what I want, too). I have been an xbox 360 owner for over a year now and microsoft continually improves the console (most recently with NXE). even my experience with the red rings of death hasnt soured me away to the PS3... mostly due to the price, imagine that!

[JROD0823]

that is your opinion and you are entitled to it, but the rrod is a stupid technical problem that still hasn't been resolved yet. you tell me about ONE ps3 that has had MAJOR PROBLEMS similar to RROD and i'll concede that you have an actual vaild point. i have owned an original ps3 60gb w/ emotion chip for over 2 years and have had absolutely no problems with it .so the "cadillac" system to me is the obvious choice if you want a reliable gaming system that doesn't DIE on you. add to the fact that the wii and 360 are made with about 2x more toxic chemicals. that should make anyone who owns one feel guilty aboul all of those 360's that go RROD and can't be fixed and are ruining the environment in a landfill somewhere while i'll be playing on my same ps3 for at least the next decade

[Get_a_life_Leo]

Don, what is the iSuppli estimate for the cost of the Xbox 360? Microsoft has likely been far more willing to dig deep into its pockets than Sony. MS does have deeper pockets and the 30% RROD failures must also be eating into profits on hardware. The current PS3s are cheaper than the originals, but don't have hardware support for PS2 games and also don't sport any new features compared to the original.

Presumably, the biggest problem for Sony is that the number of games sold per PS3 is less than the Xbox and that is where the profit lies (along with other payment schemes that Xbox has compared to the PS3 - although that will change with PS Home. Too many PS3s are used as BluRay players for Sony's liking....

[pjhenry1216]

The attachment rate isn't too much lower than the xbox 360. the ps3 is slowly releasing must-have exclusives. they just need a few more. it would have been nice if final fantasy didn't drop its exclusivity for its next release. i own the ps3, xbox 360, wii, psp, nintendo ds, (and a ps2 and xbox and n64... skipped on the gamecube though). I have to admit that I enjoy the ps3 more often as a blu-ray player than a video game console, but i also in general watch more movies than play video games these days. i also admit that i prefer games on the ps3 for the most part. that doesn't hold true though for multi-player games due to xbox live being far superior to what sony is offering and also for items such as rock band, where i'll be more likely to bring my controllers somewhere else and most people i know own a 360, not a ps3.

The ps3 is a superior machine (in my opinion, of course) in terms of graphics and gameplay (i always found the controllers for the ps2 & 3 far more intuitive than the xbox controllers) which would have been ok except its not only failing to hold its own, but it seems actually suffering in almost every other aspect (exclusives, online play, and in a vicious cycle, its non-popularity forcing me to buy games for the 360 if i want to ever play that same game at a friends house or what not)

[ittesi259]

@pjhenry,

Considering the sad sale rate of PS3's its understandable that game developers no longer want exclusive PS3 releases, lack of console sales will inevitably lead to lack of game sales.

[Maclover1]

@ittesi259 yad sad, 17 million sad. PS3 sold more in its first 2 years than the 360 and the 360 did not have the PS3 and Wii to compete with.

17 million in two years plus probably another 4-6 million PS2's in that time frame. They are making money on every PS2 sold big time. MS has only the 360 to make money off of because they flat out killed the Xbox 1.

The only question I have is will the PS3 sell more than the 360 in its first 3 years.

[Chapmaniac]

This has caused another buying trend; you tend to buy what your friends have at their homes. I don't know a single person with a PS3 but many have the 360 and the Wii.

[celticbrewer]

In your opinion. I rather have something my friends DON'T have. Slightly more of my friends have Xbox and a lot more have Wii. Those with XBoxes (they're on their 3rd or 4th box due to hardware failures, BTW) have told me they want PS3s, but just don't want to spend the money. Of course, with all the replacements, add-ons (now useless hd-dvd box), and x-box live subscription costs, I wonder how much they're really saved.

[cchenoweth6]

LOL.. nice celtic brewer. You must feed on negativity. I have an launch xbox 360 (used almost daily) and it is still going great!

Do you have 1 friend or something?

Secondly the Xbox Live experience is great. It is actually a lot of fun to play with a friend online easily.

[Blacksheep1982]

I have owned a Wii since 2007 due to it's cost and a few innovative games, love it to death, and I did most of my high end gaming on my high end PC. However, I also wanted a Blu Ray player that could be updated wirelessly and thus never be out of date, so I jumped and bought a PS3 at a Black Friday online deal in which I also got Far Cry 2 for free and a discount on the PS3 itself. With shipping and tax, the whole thing was $400 exactly. That is a bit much for my liking and I hesitated to buy it over the last two years because of the price. I'm glad I have it now, but it hurts my credit card bill and I can see why many don't want to purchase it or simply can't afford it considering the alternatives.

That said, it is an amazing Blu Ray player and both games and movies look great, although PC gamer that I am, the damn controller sucks in FPS games. How do you damn kids shoot for accuracy with a joystick!?!?!

[srhoda]

"How do you damn kids shoot for accuracy with a joystick!?!?!"


Haha, I want to know the same thing. The only reason I have a PS3 is because of BluRay player. I bought it about a year ago when stand alone units were more expensive than the PS3.

[Philips]

"How do you damn kids shoot for accuracy with a joystick!?!?!"

They do not.

Main advantage of consoles (as FPS goes) is cheat-free multiplayer and (as compared to PC) slowed down gameplay.

Also, you must consider plain fact that FPS for most people is quite hard genre: I have lots of experience teaching people to play FPS on PC and really few can master it to level where they can play it with me. And I'm personally slightly below average.

But getting back to your question: you can't properly target with a joystick. And if you noticed, most console FPS rarely throw you into open spaces. Most of the time you are in a relatively narrow passage where targeting with joystick becomes somewhat possible. Still, if you ever compared FPS gameplay videos from PC vs console, the best players on console move and shoot extremely slow compared to their PC counterparts. Bad played on PC is dead within few seconds, on console you can run around for minutes unharmed.

[Maclover1]

@philips *** are you talking about. I have played, COD2, 3, 4, 5, Rainbow 6 Vegas, R6V-2, Ghost Recon AWF, same thing -2, Resistance 1 and 2, Halo 3, GOW and Socom on the my PS3/360. I did play FPS games on PC's years ago, and the transition was tuff but um I would not go back now.

"most console FPS rarely throw you into open spaces" ????? COD4 and 4 are almost identical on the PC vs the console. Halo 3 has tons of open space.

I think you have NO IDEA what you are talking about. The BIG difference on the console is "aim assist" that usually cant be turned off or on so everyone gets it. You dont even notice it. Cheating is all but gone. If someone is cheating its a area of the map that has a glitch and not some hack they have injected into the game. Patching a console game does not require finding a FREE place to download a huge patch only to find out its got to many people trying to so you must wait or pay filefront or some other place for the download. No figuring out whether you should get the full patch or the small patch like in PC games, you simply get the patch quickly and it installs it for you on a console.

Way more FPS games are sold on consoles. Take COD4 it has sold over 13 million copies, less than 1 million to PC gamers, so FPS games on a console has to work.

[soutrik93]

the simple answer is, we don't shoot for accuracy, and we dont play blindingly fast. thats why twitch-shooters like Quake 3 or UT3 belong on the PC. On the other hand, a tactical FPS like RB6: Vegas 2 works MUCH better on consoles. Smoothly pulling a trigger and sliding into cover feels so much better than pushing a clunky button. Then you have 3rd person tactical shooters like GRAW, which are totally unplayable on the PC because you have so many functions (squad command, weapon adjustments, etc) that hunting for the right keys gets annoying, unlike the consoles, which use streamlined circle menus. Also games like Left 4 Dead work better on consoles, because having a laser mouse and crosshair makes aiming more precise than in real life, which is totally unrealistic. With a controller, your hands are shaking and you're jumpy, exactly how you would be if there were zombies around
of course you can use a controller on the PC to get all these things, but the moment u step online with a controller, youll be dead within seconds

[Ian721]

That's main reason I don't own a console, because of FPS aiming issues. I don't have a huge amount of time to spend gaming and when I do have time I'm almost always playing a FPS. (I've been doing it since I had to mess with modem strings to get my 14.4K US Robotics to work with Doom2.) And there's no way to satisfactorily aim with a controller. But to each his own.

[sparrowhyperion]

Perhaps Sony should put some serious effort into attempting to reduce cost more. Re-design the system to use a less expensive and more up to date processor, video subsystem and disk player. Offer a model with a standard DVD instead of Blue Ray. There is no way that it should still cost that much to produce this long after it's inception. If you want to be very technical, the technology is all of the current video game consoles is getting close to Obsolescence. Cut costs and reduce the price where consumers don't hhave to be J.P Morgan to afford one. It's just a game after all.

[brian.lee]

Umm Sony's hardware is still superior to whats in the xbox...

Also you have to factor in all the "hidden" costs behind the xbox for example all the extra cable you need to buy, the wireless network module that snaps on the back if you want wifi access. The rechargeable battery pack for controllers. I bought a Halo edition xbox and ended up spending atleast another $150 - $180 on extra components. The wifi module alone costs me $89.99 and extra controller plus a cable if you want to use optical out.

[Knightro2]

You can't downgrade to a standard DVD as I believe all the PS3 games are on BluRay discs.

[BlitzBoy1120]

ok, if Sony were to have a standard DVD player drive, how the hell is it going to play video games, if the games are on blu ray? u have good ideas but think before you speak..

[umbrae]

"by BlitzBoy1120 December 30, 2008 9:53 AM PST
ok, if Sony were to have a standard DVD player drive, how the hell is it going to play video games, if the games are on blu ray? u have good ideas but think before you speak.."

What he was trying to say is that the "extra" costs related to the 360 are optional. You get everything you need out of the box to play (in HD). You only need the extras if you are going to use them. So instead of $399 in one chuck, its $199 now. Later I can get an HDMI player or a larger HDD or whatever. People are going to start cheap and work up. The PS3 requires most of it up front, but you may still need things like extra controllers, etc. Besides, who in their right mind would WANT to play games over wireless. You PS3 people must not play many online games if you think that is a bonus. I would rather start wired and upgrade if I need too. Thats a cost savings.

[sting7k]

"by brian.lee December 30, 2008 9:27 AM PST
Umm Sony's hardware is still superior to whats in the xbox...

Also you have to factor in all the "hidden" costs behind the xbox for example all the extra cable you need to buy, the wireless network module that snaps on the back if you want wifi access. The rechargeable battery pack for controllers. I bought a Halo edition xbox and ended up spending atleast another $150 - $180 on extra components. The wifi module alone costs me $89.99 and extra controller plus a cable if you want to use optical out. "

And the PS3 doesn't have the same costs? Sony doesn't even give you any form of HD cable in the box and only one controller as well. Gaming on Wi-Fi just causes lag, no need to force people to pay for it if we don't want it.

[pjhenry1216]

@umbrae: Wireless isn't necessarily an upgrade for some people, but a requirement. Not everybody can run ethernet to their living rooms.

@sparrowhyperiod: the whole point of this article was that they're trying to reduce the costs. you can't honestly think they're TRYING to sell things at a loss. They're trying to make it as cheap as possible, but they can't cut corners and lower the quality compared to what they already have. I mean, they already dropped the ps2 compatibility. Thats pretty much the only thing they CAN drop. Blu-ray can't be dropped as all games are ON blu-ray, which is a definite advantage over regular DVD. I'm currently playing Lost Odyssey on the 360 and its on 4 discs. This wouldn't happen if it were on the ps3.
In any case, you've pretty much stated the most obvious thing you could have possibly stated. They can't just offer units with various "extras" cut out as some, as stated, are required, and others would probably require such a drastic change in production that it's probably more expensive to produce without it (remember the very first role out, where they lost more money on the core model instead of the high end model?)

[umbrae]

The thing is these are not hidden costs. You can get HD gaming out of the box. If you don't/can't run wires, thats an option. You want/need to use a different cable: option. These "hidden" costs are the same for the PS3, Wii, BR player, HDTV. A hidden cost would mean something you actually need, that is not listed, to use the product in a basic way. The 360 says - accurately - what the box includes and will work out of the box.

HDMI cables are cheap. A wireless access point is less than 20 dollars. Get off the hidden costs for the 360: that is FUD you are using to justify your PS3 purchase.

[ittesi259]

Sony bit itself in the foot by putting Blu-Ray in the PS3....it delayed the product, allowed the XBox and Wii to get a foorhold, and kept the price high....yeah they have Blu-Ray players in peoples homes because of it....but now that standalone Blu-Ray is affordable to someone who doesn't care about gaming that move will hurt. Shoulda kept Blu-Ray out of it (which was the cause of the product delayes) and they wouldn't be in this mess.

[Philips]

IMHO, throwing away Bluray from PS3 could be a possibility.

Some folks were showing game recently with main feature that the game is dynamically downloaded from the servers. To start game you need to download some relatively small (in hundreds megabytes range) setup - rest is downloaded (using prediction mechanics) on as needed basis.

Say basic model without Bluray with 150GB HDD where all games are downloadable.

But then we end up in hot water that gamers wouldn't be able to sell games they already finished or simply don't like. And S/H game market is quite influential to be ignored: at $70 one hardly can experiment and buy new unknown game.

P.S. Rereleasing some games without cinematics on DVD could also be a possibility. I'm one of those unskippable-cut-scene-haters - I would prefer version with less water.

[celticbrewer]

@'259 "but now that standalone Blu-Ray is affordable to someone who doesn't care about gaming that move will hurt"

Hurt who? Current or future buyers? As a current owner who doesn't really care about gaming, I don't feel hurt. If I had to pick a BR player today, yeah, I'd probably go with a standalone (cheaper) player. But that hurts Sony, not me. I'm enjoying my PS3 as a BR player, media center, and ya- I do have a good amount of games now; but gaming is not a priority.

If you're a gamer who only wants games, maybe xbox is the choice. If you only want HD movies, a BR player is where it's at. If you want both, the PS3 is still a better value. And no, I don't think HD downloadable content is anywhere near as good as a BR disc in terms of video, audio, or the extras. Not to mention content- the HD offering on netflix is shameful.

[probell]

Sony made a similar mistake in defining the Blu-ray standard as in designing the PS3. They put too much priority on advanced technology and not enough on low cost. Because of specifying blue wavelength lasers, Blu-ray can store more than twice the data as would have been possible with HD-DVD. However, the component cost of manufacturing Blu-ray players is higher than it would have been for red laser based HD-DVD players. Furthermore, because of the new size of disc features, disc press operators need to buy new expensive equipment to support making Blu-ray discs. As a result, whereas HD-DVD discs could have been manufactured cheaply enough to be given away in cereal boxes and magazine advertisements, Blu-ray discs manufacturing costs make them useful only for serious movie fans. As a result, Blu-ray will lose out to HD video over broadband services before realizing anything close to the market penetration that DVD achieved.

I'd love to see you research and write a future article on that.

[brian.lee]

Have you considered the failure rate of Xbox 360 against the PS3? PS3 has a much higher build quality it's also very quiet compared the the Xbox 360. I mean just look at the power brick that comes with the 360. Another nice thing the PS3 controllers charge over USB. I alone have had 2 360 controllers partically fail... the cable when attached woudln't charge the battery pack because there was a short in the connector on the controller.

[umbrae]

"by brian.lee December 30, 2008 9:29 AM PST
Have you considered the failure rate of Xbox 360 against the PS3? PS3 has a much higher build quality it's also very quiet compared the the Xbox 360. I mean just look at the power brick that comes with the 360. Another nice thing the PS3 controllers charge over USB. I alone have had 2 360 controllers partically fail... the cable when attached woudln't charge the battery pack because there was a short in the connector on the controller."

The failure rate is not high. I do not know anyone that had a RROD and most have release systems. This is a manufacturing issue and Sony is just a prone to them. The PS2 had many more problems than the 360. I also have tons of controllers (I have 2 360's) and never had a problem with any of them.

I doubt the PS3 are made any better: the cost is related to tons of built in components that are already expensive. Sony uses China to manufacture just like MS. The lower failure rate is more likely due to the differences in sales figures. You have to own one for it to break, and since Sony sells 200 PS3 for non-gaming computer research I would imagine their current sales figures include people that don't even use the system for gaming.

[Get_a_life_Leo]

The failure rate of Xbox 360s is as high as 30% as cited by several studies. The PS3 is significantly lower (less than 5%). Just because you don't know anyone who suffered the RROD death or other failures, doesn't mean a lot given that Microsoft has acknowledged the problem - and to be fair, has tried to reduce the replacement hassle and has even covered the RROD issue with a lifetime warranty. Still, it hurts their bottom line.

BTW, how can failure rate differences be due to sales figures? A rate is a rate is a rate.

[pjhenry1216]

Seriously, do a tad bit more research. HD-DVD employed a blue wavelength laser as well.

Also, ISPs are already closely watching video over broadband. In Europe, ISPs are already charging extra so that BBC's streaming video is 'better.' If HD over broadband catches on, expect to see much smaller caps in place. The only reason that caps are so high right now is that a majority of people don't come close to using it. If you give the average user a reason to use a lot more bandwidth, expect the caps to drop OR say hello to pay-per-byte pricing again.

Blu-ray discs will eventually come down in price own the new processing lines are paid for. DVDs cost over $20 as well when they first came out. True, maybe not quite close to $30 as blu-ray is, but nonetheless, they were expensive at first too.

[Maclover1]

"The failure rate is not high. I do not know anyone that had a RROD and most have release systems. "

Do you know only one person with a 360? I play with a group of 20 or so people. All but 1 person has had at least 1 RROD, and some of them have a elite model you know with the fixes in place. I bought my 360 in May of 2006 and it has RROD twice.

[probell]

pjhenry,

Indeed HD-DVD used a smaller wavelength laser than DVD. However, the plastic used in CD, DVD, HD-DVD, and Blu-Ray discs is part of focusing the laser onto the track of pits on the disc. A smaller wavelength laser requires that the plastic be less thick to focus the light. The HD-DVD standard chose a laser wavelength such that the plastic thickness of existing dual-layer DVD making machinery could be used for making HD-DVDs as well. Blu-Ray will require all new machinery using Sony-patented technology. Sony wields their patents in business negotiations to force disc makers into new license contracts requiring adherence to new DRM. Initially Sony would not licensing Blu-Ray disk making technology to the porn industry. Sony has since loosened up in terms of trying to censor the world's freedom of speech in HD.

There will certainly be hundreds of millions of Blu-Ray discs sold and its creators will be able to tout their success. However, I stand by the assertion that if HD-DVD had won it would have been billions and billions of discs and the disc format would have been a stronger competitor to broadband. With Blu-ray as a weak competitor to broadband video services, there is less to prevent broadband video service providers from inflating consumer prices through techniques such as bandwidth caps. In the end, consumers will end up paying more for HD video than they would have if HD-DVD had been the HD video disc standard. Of course, with multi-billion dollar markets at stake, it's rare that businesses pass up opportunities to profit for the sake of the good of the people.

[Oliver514]

the sad thing is that this "article" or a similar one has already been posted a few days ago on dailytech.com, stating that the cost to Sony is about $50 over the current selling price of $399. Don seems to enjoy rehashing or restating things..

[nachurboy]

Last time I checked, this isn't dailytech.com. Some people read multiple sites (like you, obviously) and get their info from multiple places, so I don't see anything wrong with "rehashing" information. Different writers gives different perspectives.

[glassgorilla]

The isuppli report came out yesterday... so... the dailytech article is either not from "a few days ago" or didn't have necessarily trustworthy sources. And even if they had.. so what? You think only one publication wrote about the Giants beating the Patriots in the Super Bowl earlier this year?

[Oliver514]

Nachoboy,
If something new was brought to the table in this article I wouldn't have complained, so apparently, I think it is pretty close to "verbatim" of the other article on dailytech.com. Just seems weird to write an article restating the exact point of another article. Maybe to say, "Hah this was my idea?" Proper credit doesn't seem like it is being given that the there was no price drop for the ps3 because the current cost to manufacture is about $50 over actual store price.

[nachurboy]

Oliver,

The point is, not everyone reads dailytech.com. So your point only makes sense if everyone who reads CNET.com also reads dailytech.com (which I happen to).

[stigmattaman]

I agree completely Oliver, this is Don rehashing other people's work (again) and unfortunately, getting a ton of page views and comments (from me, again). Sigh. I remember when CNET didn't have to resort to link baiters ....

[pjhenry1216]

As almost the entire second half of the article is his perspective AND not found in the dailytech article, I find your comment somewhat confusing. About 50% of this article CAN'T be found at DailyTech, which pretty much only provided the fact, not the analysis. Thanks for complaining about nothing though.

[Oliver514]

Fine, I may have "over exaggerated" on saying that the article was "verbatim" to the dailytech article, but in a nutshell it is talking about the same freaking thing and it isn't the first time I've seen Don "rehash" other peoples articles as stigmattaman also pointed out.

"You think only one publication wrote about the Giants beating the Patriots in the Super Bowl earlier this year?"-glassgorilla

I disagree because the difference is that many sports writers cover these such stories with recaps/insight, while this article "may give the impression" to certain readers" that Don Resinger somehow came up with all these facts, when he is reporting on something that another site has already reported on. Yes, he may have added a paragraph of his thoughts, but I just don't think he deserves much credit, when I'm sure certain individuals are giving him it for reporting this.

Like I said, I'm most likely just peeved that Don tends to do (rehash/recycle/choose your favorite adjective) that, in my humble opinion.

[Oliver514]

It seems like a 80% regurgitation to me of said dailytech article......

http://www.dailytech.com/Report+Sony+Loses+50+for+Each+PS3+Sold+Today/article13777.htm

[chip43_]

The price is steep but the huge graphical difference between xbox and ps3 still seems to be actually small and in fact some games look better on xbox. If sony's console is that much better they need to prove it! I also think sony needs to bring back backwards compatibility and maybe a way to control the game with your body using a camera.

[umbrae]

I would agree, but of course we will be attacked as Fanboys. People feel they need to justify their PS3 purchase, and I can understand that. It was obvious the problems the PS3 would have and all the predictions came true. The Wii won the console wars and the 360 is second. By the time the PS3's "value" comes into focus, both MS and Nintendo will have new consoles. And if you think your PS3 you bought in 2006 will still be working in 2016, you have not bought many current day electronics, so don't tell me the PS3 is still a value since it equals 2 360's. You WILL be buying another PS3 between now and 2016; unless Sony makes a bigger change to the warranty than MS did.

[billytech]

I completely agree with you Chip43. Bring back the PS2 compatibility.
This is MY main gripe about the newest version of the PS3. It HAD backwards compatibility, but the newest version in in fact INFERIOR to the original.
Sony has CUT PROMISED features, while Microsoft has ADDED them.(Memory devices and free games, proper cables - MORE backward compatibility, Netflix streaming) and also dropped the price significantly.
The value that Sony promised has been diminished with each new version they come out with.

[Renegade Knight]

Pound for pound the PS3 beats the 360 for price and features. If you need the features. If you don't the 360 is a better deal. By the time I got my 360 up to snuff there were no savings to be had. The console's shoddy workmanship and design are catching up to it. It's going to die soon and you can factor in the cost of replacing it into the cost of ownership. That will put the PS3 over the top since I won't need to replace it and having both I won't need to.

Since I got the backwards compatible version of the PS3 that's a non issue for me.

[ywkhgqo]

@umbraem, i have a launch ps2 and it still works perfectly. Sony's workmanship is superb and i would expect a PS3 bought in 08 to make it to 2016

[umbrae]

"@umbraem, i have a launch ps2 and it still works perfectly. Sony's workmanship is superb and i would expect a PS3 bought in 08 to make it to 2016"

I have 2 launch original xboxes too. However, a lot has changed in electronic manufacturing since then. Its been almost 10 years since the PS2 and Xbox were released. China manufacturing is horrid and most of it is done there. If we discovered lead on toys and chemicals in baby formula what do you think these boxes look like inside?

[Zoobie]

IMO, backwords compatibility (and lack of it) has hurt Sony more than Blu-Ray. 120 million PS2s sold, and I wouldn't be surprised if the actual install base was around 60 million (multi-unit households and broken or dusty units making up the difference with units sold). My family is on our second PS2 (first one broke after about 5-years use), and I just assumed I'd replace it with a PS3 when the time was right. That's no longer a given without the backwards compatibility--but I still love the huge library of awesome (and cheap) games out there.

[docparkny]

For a consumer electronic business built on an ecologic niche model with the console being the center of multiple businesses, you need critical mass which I believe iPhone/iPod touch has reached this year. Once large enough in scale, time and money invested in making products for this ecology is worthwhile for people involved as secondary producers/suppliers. Sony's problem all along has been its insistence on shoving through another proprietary format in a long list of proprietary formats -Betamax, Memory Stick, MD Disk, UMD Disk, and now Blu-Ray.

http://golfism.wordpress.com/2008/12/29/nintendo-ds-versus-ipod-touchiphone-3g/

[pjhenry1216]

the iPod and iTunes pushed proprietary formats. Apple is actually ALL about proprietary EVERYTHING.

And lets not forget Sony's proprietary format of the 3.5" floppy disk.

And VHS was proprietary as well... it was just willing to carry porn whereas betamax would not. Ask anybody and they will tell you that betamax was superior.

[Universal_Indie_Records]

"Apple is actually ALL about proprietary EVERYTHING" -

Yeah ok. Apple's iMac was the first computer to really push USB... after that USB was all over the place.
Some people always speak out of the wrong side of their bodies...

[brian.lee]

And for those who think I'm a fanboy because of my comments I own all 3 systems 360, PS3 and Wii.

[glassgorilla]

...and you're obviously a fanboy. A rich fanboy, but a fanboy. Denial aside, I don't think that's relevant anyway. You love your PS3. So what? From one of your comments: "The wifi module alone costs me $89.99 and extra controller plus a cable if you want to use optical out. ".... notice the important part, "IF YOU WANT". Obviously, you wanted to, so the Xbox cost a litte more than the price of the console. What you seem not to understand though is that most of us can't afford Blu-Ray movies, TVs that can play Blu-Ray, optical out equipment, wireless networking etc. Sony doesn't seem to understand that Xbox has set it up so "power users" can purchase things "IF THEY WANT". I would gladly hook up an ethernet cord to an Xbox instead of wireless if it saves me $100. Microsoft gets it. Sony doesn't.

[umbrae]

Not that I am calling you a fanboy, but just because you own all the system doesn't mean you aren't one. From your posts it seems you like your PS3 better, so there is bias.

I do not consider myself a fanboy. I own a Wii and 2 360s. I like my 360, but I am not a MS fan. I will say I hate Sony, and there are many logical and factual reasons too. Root Kits, DRM, Engineering and Marketing Practices: Sony has not been a good to consumers. Maybe you have had other experiences, but Sony has not been kind to me so I don't get them my money. It is this reason most people take me as a fanboy.

I do not hate the PS3 - actually I admire the Cell Proc - but it is not the holy grail people make out. You like the graphics better? Fine, but I have seen them side by side. I like the graphics on the 360 better. The PS3 might have more detail textures, but colors suck. They both run at the same resolutions. You like your PS3 fine, but more often than not people are just bashing the other guy. I am just trying to defend the 360 because it stands up to the PS3 just fine.

But whatever, I enjoy to argue. :)

[Renegade Knight]

I have all 3 as well. Each has strengths. Each has a weaknesses.

Being a realist I like the system that better does the job I have in mind for it. That's the PS3. One of my key criteria is that the system be around for more than 3 years. I don't want to have to buy another just because of crappy quality, or planned obsolensence. The Xbox franchise has both. Heck the only reason I got the 360 when it came out was my Xbox had blown up, I didn't wan't a PS2 and the PS3 and Wii were not yet born.

I still have grips about the PS3. Just less about it than the others.

[Nael]

You give the Console at a subsidies cost similar to the cellular industry and you recoup the cost from your online subscription services and royalties from the actual games themselves. If sony stuck on cost as being the sole reason for not reducing the price, they have lost the bigger market and that is the Media entertainment centerpiece in the living room.

The Xbox is years ahead of Sony in terms of price, game selections and the Xbox Live services .

When it hits 199.00 , I might just purchase one but until then, I will not spend 399.00 for a unit that draws 285Watts of power.

[nachurboy]

You can't compare cell phone subsidies to console prices. Cell phones are subsidized because the carriers pay "retail" (ie. not cost to manufacture) for the phones and recoup any discounts by contractual service agreements with customers. The cell phone makers are making money when they sell to carriers.

The console makers are selling at a loss vs. manufacturing costs to retailers who can't subsidize in the hopes they'll recoup the loss from software royalties. Totally different business model from the cellular model. Also, Microsoft charges for Xbox Live Gold, while Sony does not charge for any Internet service. That's to their detriment that they don't have any premium internet content, but it's their business model.

[Spanwite]

So, you suggest add $5-10 to the game price and/or the subscription, that might made it more affordable? People going to cut everywhere, at this economy times.

[Renegade Knight]

You pay for "Live Services" on the 360. I never understood why MS charges you to play over the net when you already pay your ISP to access the net. However once you are paying I have to agree the "Live" is better than Sony's free version. For now. Personally I'm not going to pay for "Life" on any system when I had to pay for the system to begin with. I've never understood paying for WOW and then paying to play WOW. They should give away the program and then charge the online fees. But it seems to work for a lot of folks.

[Maclover1]

The current PS3 draws 135 watts max since the switch to .65nm CPU and GPU, less than the current 360. I payed $399 for both my 360 in May of 2006 and my PS3 in August of 2008.

You are focusing on a single point in time, specifically now when the 360 for the arcade/core/cheap @$$ version is now much lower. Who would buy a 360 with out a hard drive????? Trying downloading a 1.2gig demo on your memory stick????

I did not buy a wireless controller for my PS3, but I did for my 360. I did not buy a HDMI cable for my PS3 as I unplugged my DVD player and used its HDMI cable.

To the genius above that made this comment "TVs that can play Blu-Ray" are you playing your 360 in SD? BD movies are better at anything higher than 480p. So a movie at 720p on BD is better than a movie at 480p on DVD. To get the true gaming value of either the 360 or PS3 you need at least 720p. If you are playing either on a SD TV you should not even comment hear as you have no idea what HD gaming is then.

[martin1212]

Seems misleading to compare the cost of parts with the retail price of $399. What matters is the price that Sony gets for the console before the reseller profit margin brings it up to $399, assuming most consoles are sold by resellers rather than by Sony directly. Anyone know what that is?

[nachurboy]

I don't know what the markup for PS3's are, but my guess is it's about a 1-2% margin for retailers. The software is where the margin is. I used to sell video game products, and got out after a couple months due to this low margin returns (I was actually losing money on COD costs and shipping costs). It's strictly a volume and accessories business for the retailer.

[tauvix]

There is a markup of less then $5 on all consoles - this has been widely known and published for years. Much like the console manufacturers themselves, the retailers make their profit on the accessories and games.

Incidentally, the games also have a medium-small markup as well. Most retailers only make about $5-7 per game at release.

[Knightro2]

For the past couple of years I wanted a PS3 so bad because I was addicted to the PS2. I just couldn't shell out that much money for one due to upcoming wedding expenses and I just didn't believe an "entertainment system" should cost that much and then have to buy $60 games.

My grandfather got my fiance and I a Wii for Xmas a year ago and we love it. I mainly played all my "mature" games on my PC but it still lingered in my head that I wanted a PS3. I came into a little bit of money and was ready to buy one. Since the Wii mainly has family friendly games I began researching the PS3 and Xbox 360 and found out that the Xbox would do everything I wanted it to do. I was excited about the BluRay on the PS3 but then realized that I would never really buy a BluRay DVD anyway. I have since purchased the Xbox 360 with 60GB hard drive and love it to death. My fiance and I actually use the Xbox more to watch movies and downloaded programs then we do playing it...although she is now addicted to the Hexic HD game that comes on it preloaded...I on the other hand am addicted to GTA IV.

[umbrae]

Good for you. Regardless of what you selected, you made a informed and research decision. Very few people put forth the research when they buy a system. They jump on hype or product loyalty.

[seespottype]

The problem with the PS3 price is not that it is higher than the others, but that for the additional price, you aren't getting a better gaming experience. We've all seen that graphics wise, the 360 and the PS3 are nearly identical. Title selection wise, Microsoft is more aggressive in pursuing exclusive titles - and the decision to remove backwards compatibility only compounds the title problem. And Sony is very late into the Social gamer scene.

Sony should look to Microsoft on the gaming experience. Microsoft (much to my frustration) focuses on the game market first, and they say that in every discussion they have with their public. Movies and all other forms of entertainment are secondary. From a Microsoft perspective, the blue ray drive would make a great add on - but there is no compelling argument to include it in the base unit.

Now I understand that Sony sees the PS3 more than just a console. And good for them, it is a great piece of hardware. But I haven't seen any ads to indicate that the PS3 is anything more than a console. For example, I haven't seen an add in my a/v sites toting the PS3 as a blue ray player - or a more appropriate music server (because it is quieter than the 360).

So to all the world, Sony has a very expensive console player that doesn't deliver a better gaming experience the the 360. Sony needs to make the decision - configure a core console machine, or really try to market a broader experience in the respective channels where that audience lives.

[umbrae]

To their credit, Sony did have some advertising that promoted it as more than a Game console. However, PS3 advertising dropped off after its initial release. Obviously, with BR players dropping in price that route probably doesn't hold up well now. However, there was advertising that included more than gaming in the commercial. However, after last year they move to advertising games rather than the system itself.

Thing is that people really don't seem to want to move computing into the living room. Movies and Games: Sure. However, web browsing on the TV has never taken off, and it is uncertain what other activities the PS3 will be able to do beyond being a media/gaming console.

[sting7k]

That's a good point there. Sony is still marketing the PS3 as a game console at retail. But all their talk in the press and to their fan base is about all the other stuff it can do, something that the normal people never hear about or see.

[pjhenry1216]

I've played multiple games on both platforms (as I own both). When Assassin's Creed came out (touted as the "first next-gen" game), I played it to completion on both the 360 and PS3. The controller on the PS3 was better suited for the game (but thats of little importance as thats game-specific), but the graphics were indeed noticeably better. Maybe you can't see the difference on lower quality TVs, but on 1080p, the difference is definitely significant and the PS3 is definitely better. That being said, its obvious that there won't be a difference if no attention is given to detail in the game. Not many games go for the amount of detail that Creed did, so in those games, yes, the difference isn't as noticeable.

Also, its not that Microsoft is more aggressive in pursuing titles, its just they had the install base to convince developers to go exclusive.

Also, the compelling argument to include blu-ray in the base unit is that the games ARE blu-ray. They load faster. They store more information. Some games were forced to skimp out on details simply because they didn't have the storage capacity available in the 360 version and they didn't want to make two different versions. The 360 is technically responsible for making games a little less pretty to look at since on the more substantial games where capacity became an issue, graphical detail will be the first thing cut as opposed to actual content.

If the PS3 could lower its price AND if they'd lower the price of blu-ray discs (which i wonder what the markup is as i've seen discs being sold at varying prices from store to store for the same movie), the PS3 would definitely sell very quickly.

[Renegade Knight]

Both Sony and MS have plans beyond gaming console. Thus far I've been able to do things with the PS3 outside of games that I can't with the 360. That said, Sony made even that a PITA. It's going to be easier to boot the PS3 into Linux and get Linux to do the media center jobs.

[seespottype]

I see no way to reply to the replies, so I'll just add my replies here. Thanks to everyone for piping up....

To Renegade Knight:
You are right, Microsoft has plans beyond games - I use their movie service regularly. But if you listen to their podcasts (Major Nelson) or you read Xbox interviews, they unapologetically say that the Xbox is primarily a gaming console. That very public emphasis cannot be understated in the context of this topic: what it does is keep hardware contained to directly address gaming requirements. And this contains costs.

Sony right off the bat is targeting larger scope. Which is great. The only problem, they don't aggressively advertise this functionality to the respective core audiences. So again, I frequent a lot of AV sites. I can't remember once seeing an add for PS3, saying "hey, we make an excellent blue ray player. (and it happens to a lot more too...). " So to the broader audience, the PS3 is a gaming console. Not a multimedia console. And on that basis, it is evaluated on price.

To pjhenry1216:
I've only seen the graphic comparisons done on gamespot (http://www.gamespot.com/features/6162742/index.html). This was admittedly first generation games, and I think a point made by Gamespot was that graphics on the PS3 would get better as developers became more comfortable with multi threading. If PS3 graphics are really that much better now, than that should be the point of an advertising campaign. "Hey, here's why the PS3 costs more: look at the better graphics!".

Please see that I'm not saying xbox is better than ps3. For sure, hardware wise it isn't. But Microsoft is far ahead of Sony in crafting a very consistent vision of the product. If you don't define your product, your competition will. And to that, Microsoft has been very happy to frame PS3 as just a gaming console. All things even, people compare on price.

Look to how well Apple handles the less expensive Microsoft. Apple's advertising campaign is "Yeah, we cost more, but our quality and end-user-experience is much better." So more expensive can trump cheaper.

[seespottype]

Here's an early example of console wars: Intellivision advertising superior graphics head on:

http://www.youtube.com/watch?v=IDza6eTXGEY

[heavydevelopment]

No one seems to get it. Sony INVESTED in the PS3. It's a 10 year curve. The fact that they are almost breaking even is a good thing for Sony's bottom line. Here's the thing. Most of the games don't use the full capability of the system. The Blu-Ray was essential in the strategy in that 1 year or 2 from now there will be games developed that will blow your freaking mind on the PS3 because they will utilize not only the cell processor and vid chip but the extra capacity of the Blu-Ray player. Game manufactures have not been able to develop yet for the technology and have basically used the same game on the Xbox and the PS3. At some point there will be exclusive games that will use the hardware only available in the PS3 that will BLOW doors on the Xbox. The Xbox will be stuck with DVD technology and MS will have to figure out how to deliver HD content to their system (online is not the answer.....bandwidth is the restriction and unless there is a major overhaul of our telecommunication pipes, the current bandwidth will not be able to provide HD content...unless there is a tiered bandwidth system). I can guarantee that Sony will not be licensing Blu-Ray to MS. So they will have to get into a format war OR just have an Xbox only HD format.....that will most likely not be able to play movies....just games. Mark my words, the Xbox will be in a world of hurt in 2 years. The Wii while cool, is a kids toy. If Sony were smart they would dump some money into PS2 and figure out better game play. The Wii is the Ps2 on steroids. Nintendo found a niche in the market---simple kids games that adults like too (but not really "gamers").In the long run the PS3 has the upper hand. Two years from now this playing field will be totally different.

[GamingGodfather]

I am not a fan of Sony and haven't been for about the last ten years. I used to be Sony "only" when purchasing electronics but I had so many drives fail in CD and DVD players that I just gave up on them. Now they are trying to sell a technology that technically costs a fortune. Brian.lee wants to argue the point of the overall cost of the 360, why aren't you explaining the overall cost of the PS3?
There is nothing in a 360 that requires you to have a 1080p television in order to get the full benifit, yes, games do look a lot better but I have always been a fan of the game itself with the graphics being a very close second. The PS3 requires a 1080p TV in order to get the benifit from Blu-Ray so add that to the expense of purchase. I am not sure what percentage of homes have HDTV sets but I would bet that the percentage of 1080p owners is less than 10. All those big sales at Walmart weren't getting customers 1080p, it was mostly 720p or 1080i. These are sufficient modes for your cable box but won't do justice to the power of the PS3. Blu-Ray is a glorified upscale DVD player if you do not own 1080p. You can purchase an upscaling DVD player for about 50 bucks these days.
One last comment, it was mentioned by Steve3717 that DVD would go away in a couple of years. You can not possibly believe this. The cost of manufacturing DVD's is at its lowest point since it's inception. It is making a ton of money for the movie industry. High Definition DVD has barely broken out and if you go back to my television comment it won't happen anytime soon. I would venture to say that DVD will be around for almost another decade.

[steve3717]

Godfather - I sincerely hope so. I'm running 1080i and see no need for Blu-Ray, but I suspect some studios (Sony, anyone) would consider releasing movies exclusively on Blu-Ray to try and give the market a boost. So DVDs would continue to be release for several years, but I think we'll probably start seeing some new releases exclusively on BR in the next 2-3 years. Of course, by then, high-def downloads might be more mainstream and make the whole debate moot.

[umbrae]

It is unlikely things will be exclusive to Blu-Ray until DVD sale stop completely. VHS versions of movies are still released today believe it or not. I think there was just recently an announcement of production being stopping on VHS, but if this is any guide DVD will be around until Blu-Ray players are less than $50 and discs are $5-10.

According to Samsung and other BR supporters, BR only had a 5 year lifespan. 2 years are gone, so even media companies don't see BR are being a market force in 3 years time. Media companies want to make money and DVD's are cheap to make; going BR exclusive will only cost them sales, so its unlikely to happen.

[pjhenry1216]

Its a little unfair to say that you don't need a 1080p tv for the 360 because you don't the full benefit, but then go on to say you need a 1080p tv for the ps3 to get the full benefit.

[stigmattaman]

I agree with the points here .... But ... since gaining super high-speed Internet and discovering torrents (and legal viewing sites + Netflix) I haven't bought a movie in 3 years. But I received a PS3 a few weeks ago and wound up buying Wall E and Dark Knight on Blu-Ray, and wasn't even thinking of getting them on DVD. Now, I'll probably only buy one or two disks a year, but I do think it's a lot better than an upscaling DVD player.

[nic.disassembly]

to give a different perspective, we've brought up the "hidden costs" and the "price points" of all 3 systems, but I myself have to admit (and am mad to an extent):

I already own a PS3
but I probably will be buying an Xbox 360 next year (2009)

why?

it's kind of maddening, but since market share of "true" next-gen is with that system, my favorite game probably of all time Fallout 3 is only getting add ons on the Xbox...no updates for PS3 (the version i bought)...my pc is capable, but borderline so no go there either...

it's things like that that aggravate me as a PS3 owner and make me want to yell at Sony to get it together...they have the better system bar none...but no support...

[umbrae]

Fallout is a great game, and this is exactly why I enjoy my 360. With GTA and Fallout getting exclusive content, you get more value from your 360 game than the same thing on PS3. Its not as much about the hardware as the games themselves. I hate exclusives in general, but the games I want to play are on 360 and are better supported.

[guy0]

But you are missing the bigger picture. Sure, they are not losing that much anymore, and since the release of the first PSX they stated they always planned to lose money on the system and make it up in game sales. But the main issue is, them cutting the cost's just is not smart. Why? Well the main reason is the new models no longer play PSX and PS2 games anymore, and no plans in the future to implement the ability to play those games again on the models coming in the future. This is a very bad move.

[umbrae]

In the past, the PS was in line with other consoles. With the PS3, they aimed high. They really wanted BR to win, and they hoped the Cell would make them money outside the PS3. What they did not count on is MS beating them to market and the Wii chipping at the cost cycle.

I think they expected the PS3 to sell better at the high end price allowing them to cut the unit cost via the current manufacturing improvements and selling at a loss. Instead they had to cut the cost of the unit quickly to compete with MS and Nintendo (which they never even saw as a competitor), and thus lost control. Obviously, the economic problems were not even in the radar when they started developing the PS3, so that did not help.

With electronics you have to aim at smaller cycles. Making a system to survive to 2016 was suicide, it made the design expensive and put a lot of bets into future technology. Will the IBM Cell be able to stand up to next generation processors from leaders like AMD and Intel? Will BR become common place? Personally, they made too many gambles and should have not aimed so far into the future. A LOT can change in 10 years as far as technology is concerned.

[TomMariner]

The trouble is the PS3 is worth it!

I know a comment like that will produce the same knee-jerk reaction that comes with the words Microsoft o Vista, but the black box is till rated as the best BlueRay player in certain quarters.

Yeah, there are these magic price elasticity curves where a minor price drop causes dramatic volume increases, but Sony seems to think it ain't $300. And Microsoft has a natural advantage because they are basically a software development tools company that makes it productive (although insanely complex) to develop visual software. I know one can install other OS's on PS3, but that takes it out of the realm of the casual, playing two minutes after bringing it home from the store, volume purchaser.

But from the beginning of the video game business, this has been give the razor, sell the blades kind of business so Sony had better make a game changing business before we have $99 blue ray players.

[guy0]

(" The Trouble is the PS3 is worth it!)
Not anymore sir . You can now only play PS3 games and DVD/Blu-Ray Movies on it(newer models). The fact that the new models no longer play PS2 and PSX games is what will drive sales down alot. Only people re-selling systems that have the reverse play capabilities will make any money on a well educated consumer.

[jojo311]

Actually, all PS3 models play PSX games. And although there is a lot of discussion here about the lack of PS2 compatibility, is there any statistical evidence that this is driving down sales by 'alot'?

[aaronacj]

this is what i ws thinkig when i read the comment above... well put.