Sony Has Lost More Than $3 Billion on PlayStation 3


Company continues to lose money due to pricing imbalance.
By Kat Bailey, 06/25/2008
Sony has struggled with the PlayStation 3's price point for some time now. When the console dropped in 2006, it was at a price that some regarded as too high compared to the Xbox 360 or especially the budget-minded Wii. But even with the PS3 now readily available at $399, Sony's pricing woes haven't gotten any better.
Sony's fiscal 2008 annual report (via Kotaku) revealed that pricing the PS3 below production cost has thus far lost the company $2.16 billion in 2007, and $1.16 billion in 2008. Although they chalked it up to the "significant negative impact" that introducing a platform can cause at first, Sony gave fair warning to investors that the "large-scale investment required during the development and introductory period of a new gaming platform may not be fully recovered." "In the past, large-scale investment relating to capital expenditures and research and development for the manufacture of key components, including semiconductors supplied for PlayStation 3 was also recorded within the electronics segment," Sony said in its report Monday. Sony also reported that a great deal of capital went into research and development. This could mean that even a highly successful run for the PlayStation 3 would take a while to recoup the initial investment, which appears to give further impetus to Sony's ten-year plan for the system. With Microsoft having recently said that they would be selling Xbox 360s for a long time and Nintendo still seeing booming sales from the Wii, it may be quite a wait before we see the next generation of consoles.





-Taken from 1up

People still say the PS3 will in in the long run, but I just don't see it. They are doing everything wrong at the wrong time. The 360 is really the more dominant system since the Wii has released it's big hit games, which yes it's still popular, it has like what, 3 or 4 big hits, which all mainly hit near launch. PS3 just pushes everything back, no home yet? No FFXIII yet? So they give us fillers which no one likes, while the 360 is pushing out tons of games which some are huge console sellers. I believe the war of next gen is over really, but I'll have to wait and see if people are right with their PS3 will win theory.

there is no console war. it's just meant for us to get to our roots and just buy the console we want and keep buying products for it.

It's a war though. Other companies try to suck you into buying their products while others try to keep you loyal to them. Which as we can see, Nintendo is getting a lot more people to buy one just because it's so cheap and easy.

Ouch 3 billion lettuce, Sony can barely drop the price of their system, I bet if Nintendo raised the price of the Wii people would still buy it XD

They would. A person bought a Wii and sold it used in a grocery store for 400$ here. I couldn't believe it since they are in-stock close by, people are just stupid over the Wii.

One reason it costs a lot for each PS3 is because it has a Blu-Ray player which is pretty cool. I wonder if they will stop making more PS3's anytime soon.

360 just has a more dedicated target audience who will defend it no matter what i am unfortunately one of those niche gamers..but not in anyway a microsoft fan boy...

I like the console, but I think it has a distinct lack of good exclusive games. I mean, seriously, MGS4 is the only thing I've been looking forward to, and in my opinion it was a disappointment.

who's really surprised?