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Kaz Hirai: "PS4 hardware is already profitable"

Dire

Member
They've sold over 7M so they've gained a lot of their economy of scale. I think they'll try to rely on CoD, Destiny etc and the holidays to get through most/all of their stock this year and shoot for a price cut to $300 next spring.

PS4 sales figures are dropping substantially, the hardware is profitable, E3 and its associated free press/marketing is imminent. If Sony has something interesting on the software side to announce at E3 I think the odds of a price cut to go with it are incredibly high. I'd also consider that Sony is in a fairly unique situation. The Wii U flopped and the XBone is on life support after they went all in on a title that didn't deliver. If there was ever a time for them to be able to put the nail in the coffin, it'd be now. I suppose the only question is whether they feel they're likely to bury themselves along with Microsoft!
 
i dont get it either. What this means going forward is subsequent generations will probably follow the same path and cutting edge technology will fall by the wayside and go toward more a more safe solution. But hey, if that's what gamers want

What I really want is for the companies that provide games for me (and other stuff, like Sony) to not become bankrupt and stop providing what I wanted in the first place. If that means not getting cutting edge technology, then so be it. I prefer to have them than to not have anything at all.

My opinion, obviously.
 
Wait, now people are asking for a shorter cycle? What happened to all those diminishing returns? Aren't we powerful enough for another 7 years or so?
 
Yep yep

Especially with the internal hardware being pretty mainstream, so the cost of production will continually drop at a pretty rapid pace.

I could see a $299 PS4 by this time next year honestly.

Err, you do see the current state of Sony as a whole, right? I'm not sure telling execs you intend to drop the price of one of their most profitable electronic products by $100 is a terribly smart move.
 

Toki767

Member
It's never been sold out, I've been walking into stores in both Illinois and Wisconsin since launch and always see them on shelves.

If you want a PS4 you can easily find a PS4.

Illinois and Wisconsin: The New Zealand of the USA.
 

imtehman

Banned
What I really want is for the companies that provide games for me (and other stuff, like Sony) to not become bankrupt and stop providing what I wanted in the first place. If that means not getting cutting edge technology, then so be it. I prefer to have them than to not have anything at all.

My opinion, obviously.

do you not understand how the market works? if said company goes bankrupt another company will rise and take its place.
 

borghe

Loves the Greater Toronto Area
Does he mean the platform or the hardware itself, because that was a really short amount of time to cut ~$60 cost on each unit made.

hmm... "analysts'" best guess on costs, or Sony CEO. I know which one I'm going with being correct.

It's never been sold out, I've been walking into stores in both Illinois and Wisconsin since launch and always see them on shelves.

If you want a PS4 you can easily find a PS4.
it's not sold out nationwide or such... but do any search on Walmart, Target, Best Buy, etc and it's not uncommon to see stores without stock. I just did a Milwaukee search on Target and came up with four stores where it's unavailable.
 
It's never been sold out, I've been walking into stores in both Illinois and Wisconsin since launch and always see them on shelves.

If you want a PS4 you can easily find a PS4.
It was sold out in stores for months in california. Had to get one from Amazon. Saw one on store shelves at the end of February and they've been regularly available since then.

EU gamers also reported severe droughts, way worse than we had in the US.
 

Shengar

Member
It's funny so many people are happy about this. I prefer them selling me $500 worth of hardware for $400, personally. But I'm just a game, not a SNE investor.

Compared to its competitior that (originally) have more expensive price and weaker hardware, gamer doesn't have many choice. While agree with the notion "expensive hardware tagged with cheaper price", Sony just can't eat up losses like its used to. Sony isn't a giant anymore and currently they are struggling to keep their company on their feet. PS4 is pretty conservative console and all of its basic feature, to hardware and price completely shows that when compared to its predeccesors, PS2 and PS3 that sold at lose for years. If their VR successfuly launched them once again, we might see their old strategy with PS5, if there is any.
 
do you not understand how the market works? if said company goes bankrupt another company will rise and take its place.

Why would I want to see a company crumble just because I wanted more than they could give? I'm really not trying to be a corporate apologist, but I wouldn't want to see companies like EA, Activision and things like King rise over the body of companies like Sony and Nintendo, that's just who I am.
 
i dont get it either. What this means going forward is subsequent generations will probably follow the same path and cutting edge technology will fall by the wayside and go toward more a more safe solution. But hey, if that's what gamers want

If you haven't noticed, many studios have gone broke this past gen. we would like to keep getting games regularly, honestly .
 

mrklaw

MrArseFace
There will never be a spring price cut. Price elasticity from February to October is historically very poor for gaming products. Any price cut will be timed for September/October.

Xbox one was reduced to £399 in the uk at the end of February..
 
That's a really good sign for the industry. Using common PC components will hopefully mean we won't be seeing consoles stuck at the $299/399 barrier for YEARS like we did last generation.
 

jcm

Member
:p Avy quote?
Haha whoops.

PS4 sales figures are dropping substantially, the hardware is profitable, E3 and its associated free press/marketing is imminent. If Sony has something interesting on the software side to announce at E3 I think the odds of a price cut to go with it are incredibly high. I'd also consider that Sony is in a fairly unique situation. The Wii U flopped and the XBone is on life support after they went all in on a title that didn't deliver. If there was ever a time for them to be able to put the nail in the coffin, it'd be now. I suppose the only question is whether they feel they're likely to bury themselves along with Microsoft!

What on earth are you talking about? Sales figures are dropping substantially? They are not going to drop the price at E3, period.
Compared to its competitior that (originally) have more expensive price and weaker hardware, gamer doesn't have many choice. While agree with the notion "expensive hardware tagged with cheaper price", Sony just can't eat up losses like its used to. Sony isn't a giant anymore and currently they are struggling to keep their company on their feet. PS4 is pretty conservative console and all of its basic feature, to hardware and price completely shows that when compared to its predeccesors, PS2 and PS3 that sold at lose for years. If their VR successfuly launched them once again, we might see their old strategy with PS5, if there is any.
Oh, i understand why it's happening, I just think it's a weird thing for a gamer to be excited about, that's all. Yay, I'm finally paying more and getting less.
 

Bboy AJ

My dog was murdered by a 3.5mm audio port and I will not rest until the standard is dead
LOL at gamers happy with this news. Goes to show who's a gamer on here and who's just a cheerleader. This gen is the first console gen out of many that persuaded me to get a PC. What a disappointment. Better hardware enables, but does not guarantee, better experiences.
 

Bundy

Banned
i dont get it either. What this means going forward is subsequent generations will probably follow the same path and cutting edge technology will fall by the wayside and go toward more a more safe solution. But hey, if that's what gamers want
I you want "cutting edge technology", go buy a $1200 PC.
 

test_account

XP-39C²
Lol. My own store has been sitting on 15-20 ps4s for months. Need one? Please buy them. Free up room in my vault.
Just wondering, what is your store selling? Why take in 15-20 PS4 if there is no demand at your store?


Not being a PC or a Nintendo console? That's my guess, based on the post.
Maybe, but i was wondering in more specific :) Nintendo releasing a noticeably more powerful system in just two years from now seems unlikely though, in my opinion.
 

Kuni

Member
Very quick indeed. The lessons of the PS3 are still clearly ringing in their ears. Impressive stuff though, seems like this was one of the big goals for the PS4 hardware.
 

imtehman

Banned
Why would I want to see a company crumble just because I wanted more than they could give? I'm really not trying to be a corporate apologist, but I wouldn't want to see companies like EA, Activision and things like King rise over the body of companies like Sony and Nintendo, that's just who I am.

EA and Activision aren't console manufacturers.

Besides, both Sony and Microsoft, the two remaining console juggernauts, didn't come into gaming until it was already an established medium. We seen the likes of Sega dropping completely out and Microsoft taking its place, so if Sony were to drop out i'm pretty sure another would take its place.

I you want "cutting edge technology", go buy a $1200 PC.

1200? i could get cutting edge for way less than that.
 

Salex_

Member
It's funny so many people are happy about this. I prefer them selling me $500 worth of hardware for $400, personally. But I'm just a game, not a SNE investor.

It seems like the majority doesn't consider the value vs price. They tried to stuff the PS3 with value and it didn't work. It was the cheapest Blu-ray player on the market, had built in wifi when the competitor charged $100 bucks for an add-on, was backwards compatible with PS1/PS2, DTS, upgradeable HDD, etc. I believe they were losing ~$200 on every console.

I'm pretty sure they won't (or can't) to lose a bunch of money like they did from the PS3. A lot of those things that add to the hardware value doesn't seem to matter for hardware sales and the market just wants a smaller price tag.
i coulda sworn thats what i said
Yeah...I'm quoting the wrong people. I need some sleep.
 

imtehman

Banned
The market just wants a cheap console.

i dont get it either. What this means going forward is subsequent generations will probably follow the same path and cutting edge technology will fall by the wayside and go toward more a more safe solution. But hey, if that's what gamers want

i coulda sworn thats what i said

But it does. software sells hardware, and when software is cheaper to make it increases the viability of the hardware.

hardware is cheaper, software is more expensive.
 
EA and Activision aren't console manufacturers.

Besides, both Sony and Microsoft, the two remaining console juggernauts, didn't come into gaming until it was already an established medium. We seen the likes of Sega dropping completely out and Microsoft taking its place, so if Sony were to drop out i'm pretty sure another would take its place.

I'm not talking only about console manufacturers, I'm talking about wanting too much value too. Also, comparing Sega dropping and Microsoft getting in to this really doesn't shine that bright of a picture, at least to me. I would change Microsoft for a smaller Sega any day of the week.

Dreamcast > Xbox (my opinion, again)
 

test_account

XP-39C²
LOL at gamers happy with this news. Goes to show who's a gamer on here and who's just a cheerleader. This gen is the first console gen out of many that persuaded me to get a PC. What a disappointment. Better hardware enables, but does not guarantee, better experiences.
Why cant one be a gamer and also be happy that a company they like are doing good? It doesnt say how much profitable the PS4 hardware is either, it might be like $10 or something, meaning that you're not "overpaying" big time (there are always the R&D cost that also need to be covered).
 
I do wonder if he is referencing the global ASP rather than the US specifically though. The global ASP will be significantly higher than $399 because of strong GBP and EUR performance. A PS4 sold in the UK nets them around $455 on the current wholesale price minus the distributor cut, it is a similar picture in Europe as well, given that around 50% of all PS4's sold are in Europe it will raise the global ASP to around $430, so the revenue derived on PS4 sales could give them a positive gross profit margin on hardware while still selling at below cost in the US.

The current BoM for the CECH-1006A is around $390, in the US Sony's derived revenue per sale is probably lower.
I've been thinking that dropping Kinect and $100 is a net loss for MS, figuring $75 to build the Kinect. Can you shed any light here?
 

imtehman

Banned
I'm not talking only about console manufacturers, I'm talking about wanting too much value too. Also, comparing Sega dropping and Microsoft getting in to this really doesn't shine that bright of a picture, at least to me. I would change Microsoft for a smaller Sega any day of the week.

Dreamcast > Xbox (my opinion, again)

anecdotal. How many people bought the x360 and gamed on it? Just cause YOU like sega more doesn't change hte fact that dreamcast sold so terribly even though it was cheaper than the ps2.
 

Angry Grimace

Two cannibals are eating a clown. One turns to the other and says "does something taste funny to you?"
It's funny so many people are happy about this. I prefer them selling me $500 worth of hardware for $400, personally. But I'm just a game, not a SNE investor.

People are happy about it because the more successful a console is the more likely it is that the company will pour more resources into it.
 
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