Sony Still Making Loss on PS3

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It’s been revealed that Sony, despite making some fundamental changes to its console line-up, is still losing money on every one of the new PlayStation 3 Slims that it sells.

In an interesting breakdown of the probably costs of all of the parts inside the current model of Sony’s PlayStation 3, industry analyst iSuppli has added up the totals and found that Sony isn’t likely to be making any money on hardware sales this Christmas. Indeed, it seems that Sony’s console is costing it somewhere in the region of $30 for every unit sold in the US.

Of course, all of this is in aid of the one thing that Sony hasn’t really managed to achieve this console generation – a really solid user base. The fact that Microsoft’s Xbox 360 launched earlier than the PS3 meant that Sony has essentially been playing catch-up since the beginning of this console generation; it’s not as easy position to manage.

Of course, it’s been pointed out in the past that the attach rate (the average number of games sold per console sold) seems to be a little higher than that of the Xbox 360, and that’s a fact that will help Sony to eat up the losses incurred from hardware sales.

Moreover, the word from iSuppli is that Sony is “at or near the tipping point for profitability.” So it seems that if Sony can drum up interest with its price drop and its slimmer console over the course of this Christmas, it’ll be well positioned to really pick up some serious profit in the games industry.

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6 Responses to “Sony Still Making Loss on PS3”

  1. Kevin Says:

    Sony have always run as a “loss leader” in this regard so I wouldn’t worry too much. They always run at a loss and eventually make back profit towards the end of a console life cycle. What isn’t pointed out is the bucket loads of cash the PS2 still pulls in, which brings the defecit to more managable levels (I imagine) for the entertainment division!

    • komplettie Says:

      I’ve always wondered whether or not the PS2 took potential sales away from the PS3… it might seem like a minor concern, but I’ve been thinking it since just before the PS3 launched.

      I’d love to see just what those figures for late PS2 adoption look like. Certainly they’re paying the bills though, between those and Blu-Ray 😉

      • nutterguy Says:

        Consider that the Nitendo DS has only just outsold the PS2 in the UK and you get a fair idea of how much the PS2 made/is making…
        1 in 6 people in UK have a DS…

      • komplettie Says:

        I’d be really curious to see how much money Nintendo has lost on things like the R4 too, software attach rates must be lower because of it… unless it’s really an enthusiast only thing?

      • komplettie Says:

        Again, I wonder does the PS2’s massive saturation hurt the PS3 at all in the short term… how many people are happy enough with the PS2 not to move on?

        I imagine Sony isn’t too bothered by that though, a lot of those users will eventually become PS3 converts, given enough time. That only gets more true with console price drops and the increased lifespan of this console generation too. It’s a really curious business model.

  2. Kevin Says:

    1 in 6 might have a DS, but they ain’t buying the money making part – software! This has always been Nintendo’s problem. They know how to sell a console, but no idea how to get third parties to make games for it!

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