back to article Sony posts big Q4 loss, blames PS3

Sony today reported widening losses for Q4, blaming reduced sales of its last-generation PS2 games console and costs associated with the launch of the PS3. The electronics and games industry giant booked operating losses of 113.4 billion yen (£475m) for January-March, compared with a loss of 51.9 billion yen (£217m) for the …

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Wal-Mart

I'd wager Wal-mart is partly to blame for Sony, and other electronics manufacturers' shrinking profit margins. When Wal-Mart opened the pandora's box that is sub-1k 37" plus televisions, it really gave the manufacturers of the devices and other retailers, who until then had been gouging prices, a swift foot to the bollocks. Sony's PS3 strategy could potentially prove a very lucrative one tho, the licensing rights to Blu-Ray will more than make up for losses provided that Sony can plant enought PS3s in the hot little hands of consumers that Blu-Ray becomes the preferred Hi-Def format.

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Anonymous Coward

You mean they *have* a PS3 strategy?!

Nothing to do with the fact that the PS3 is (currently) horrendously overpriced then?

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Anonymous Coward

PS3 - just too expensive

...and Sony's stubborn attitude with regard to Blu-Ray, is killing Sony.

Sony could have merged with HD-DVD and were given plenty of chance, but no they wanted to keep it all to themselves, despite manufacturing costs being higher, because they stand to make a fortune from licence fees. The very reason the PS3 has been delayed and costs so much is because of their desire to push Blu-Ray above all else, even when the PS3 never really needed it.

Having PS3 owners automatically get Blu-Ray isn't going to win the war. Cheap HD-DVD players from China will do that. You'll never see Chinese Blu-Ray players on the cheap selling in ASDA.

If Blu-Ray wins however the consumer loses. Fixed prices. Tighter DRM controls. Tighter regional market controls (remember HD-DVD is region free and doesn't have lawyers going after companies importing/exporting across boundaries).

Sony are killing themselves and damaging the HD market. They used to be such a great company, but their obsessions are even harming their product quality these days.

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Another reason not to buy a Sony LCD TV

.. aside from them being fairly crap anyway, they are likely to get crappier.

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wal-mart??

Id wager you dont know that only $16b of sonys $64 billion sales come from america, so thats not the reason. Not everything revolves round america. the reason for this profit loss is simply that they sell there ps3's at a loss therefore, of course there going to make a loss since it has just revently been released in europe, australia, New Zealand etc...

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Walmart

Just the name doesn't matter much. There are plenty more budget stores like Wal-mart, no matter where you go. Cheap HD-DVD players are finding their way into every crack and hole in the market and combining that with a much lower production cost for the individual units and discs, as well as requiring cheaper hardware to mass produce HD-DVDs, the Blu-Ray really doesn't stand all that much of a chance in the price category.

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PS3 Overpriced

It does not matter to the consumer if the PS3 is sold at a loss. If it is priced too high not many people will buy it. Sony chooses to try to gouge the consumer on an inflated price for all of its goods.

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Sold at a loss

Selling game consoles at a loss is standard practice, the idea is they're supposed to make up for it other ways and profit. If it's not making Sony money, it's not worth doing.

People just plain don't buy game consoles for $600, and that's why normally, companies don't make them for $700. Sony can't really do much about the price right now, so they're pretty screwed.

The game console market is very, very regular and certain things consistently get the vendors in trouble when they get too proud for their own good. From "it's worth about $700!" to "sooner is better right? so I'll release three years early" and everybody's favorite, "The one with the best technology wins right?"

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PS3 is overpriced but...

That's not the reason you fall over piles of them walking into any electronics department or store.

As the stupidity of $2000 PS3 sales on eBay prove, if they want it bad enough people will pay anything.

No the reason PS3s don't sell is because the games are dull - there isn't a single title that isn't either a clone of something else, or hasn't been available on just about any gaming system over the last 5-10 years.

A couple of games have specced up graphics sure, but otherwise they're just uninspiring versions of things you can buy for systems costing a lot less money.

I have a PS3 - so far I've bought 1 game, and it's crap. I've played various demos of course, but not a single one has convinced me to rush down to Best Buy or Walmart to buy it.

The Blu-Ray thing, I don't know.. but I pay about $15-$30 per movie depending on how new or how good they are. I don't have that many, because there aren't that many movies worth buying for the sake of higher resolution viewing - but I'm happy with everything I've bought so far.

The PS3 could be a superb system - it's just you need something worthwhile to play on it, and I haven't seen anything in the pipeline that could even be considered close to a killer app.

My kids have a XBox 360 - and I can't say I'm all that impressed with that either - but at least you can find more than 12 titles in your average store - and at least most of the games you like have been updated for the new system.

None of the games I played on my PS2 have been updated. Consequently it seems a bit ludicrous that those very same PS2 games are pretty much all I use the PS3 for when I'm not watching movies.

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Anonymous Coward

The butterfly effect

Sony attacked Lik-Sang. They fail to realize that a sizable amount of their sales come from people who import games for various reasons. They also fail to realize that their marketing people are monkeys - DVD regioning, NTSC/J consoles and Japanese games in a country whose majority barely spoke Japanese and whose TV system is PAL...

What goes around, comes around.

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Andy Bright is right

I'll buy one when the price drops a little next year, no sooner, and that's contingent on killer apps. They've lost enough on production costs that they've saved by not maintaining exclusivity on the biggest titles - and that will punish them more than they know. Halo, an ejoyable but overrated FPS still manages to generate BIG xbox sales because exclusivity adds to the hype and sates the fanboys. GTA used to do the exact same thing for Sony, but no more.

I'm not bothered about better graphics *that* much, and I'm certainly not bothered about blu-ray (I genuinely think the importance of HD is being being exaggerated in ttechy/gadget community, and happily by retailers).

I am bothered by the fatc that Sony stuck to the same tired roll-out system. Asia gets a cheap console, Sony make a loss, America gets a not-as-cheap console,. Sony looks at tehir loss again, and then AFTER everyone else, europe (a big affluent market) gets a release way after everyone else with a price double the original. Why am I paying more to get the dregs?

Disclaimer: I own a lot of Sony kit - had a ps, have a ps2 and a psp, and both my phone and camera are sony, so I can honestly say I've had good experience with all their kit so far. Which makes it all the worse that they've manaaged to alienate the market so much that they've broken my brand loyalty. They need a decent library, 2 or more killer apps, and a price drop before I'd take the ps3 plunge

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