A slightly different view of the same world.
The warm reception given Microsoft's Xbox 360 in the states apparently hasn't given Sony cause to reconsider the PlayStation 3's reportedly dizzying price point. In an interview with Toyo Keizai this week, Sony Computer Entertainment president Ken Kutaragi again said that the PS3 demands a financial sacrifice of its owners.
"Whether consumers think a product is expensive or cheap all depends on the balance between its appeal and price," Kutaragi told Toyo Keizai. "Our ideal [for the PS3] is for consumers to think to themselves, 'OK, I'll work more hours and buy it.' We want people to feel that they want it, no matter what. When Nintendo was selling its 16-bit machine at around 12,500 yen ($114), we sold the first PlayStation at 39,800 yen ($364)," continued Kutaragi. "The press was saying that it was expensive, but it was a huge hit. It's the same thing with the PlayStation Portable from last year. The Game Boy Advance is a same handheld gaming machine, and it costs less than 10 thousand yen ($91). On the other hand, our PSP had cost 25,000 yen ($229). But people lined up overnight to buy it, and it sold out on the day of its launch. It all depends on whether people want it. Of course, I'm confident that the PS3 is a product that people will definitely want."
Sony better hope Kutaragi's right, because according to some the company's headed for a loss of Microsoftian proporation on its PlayStation. Analysts at Merrill Lynch Japan believe the PS3 will retail for $399 in the states, nearly $100 less than it costs to manufacture. If that turns out to be the case, Sony could suffer a loss of more than $1.18 billion in the first year of the PS3's release.
I’m sure glad they’re talking $400 and not the $600 I’ve heard other places!
"Whether consumers think a product is expensive or cheap all depends on the balance between its appeal and price," Kutaragi told Toyo Keizai. "Our ideal [for the PS3] is for consumers to think to themselves, 'OK, I'll work more hours and buy it.' We want people to feel that they want it, no matter what. When Nintendo was selling its 16-bit machine at around 12,500 yen ($114), we sold the first PlayStation at 39,800 yen ($364)," continued Kutaragi. "The press was saying that it was expensive, but it was a huge hit. It's the same thing with the PlayStation Portable from last year. The Game Boy Advance is a same handheld gaming machine, and it costs less than 10 thousand yen ($91). On the other hand, our PSP had cost 25,000 yen ($229). But people lined up overnight to buy it, and it sold out on the day of its launch. It all depends on whether people want it. Of course, I'm confident that the PS3 is a product that people will definitely want."
Sony better hope Kutaragi's right, because according to some the company's headed for a loss of Microsoftian proporation on its PlayStation. Analysts at Merrill Lynch Japan believe the PS3 will retail for $399 in the states, nearly $100 less than it costs to manufacture. If that turns out to be the case, Sony could suffer a loss of more than $1.18 billion in the first year of the PS3's release.
I’m sure glad they’re talking $400 and not the $600 I’ve heard other places!
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