Analysts Expect $400 PS3

[I.E.]

Will Sony take billions in losses so that we can get our Blu-Ray?
by Anoop Gantayat
June 29, 2005 - Sony Computer Entertainment officials have stated to 3rd parties that the PlayStation 3 will launch in Japan at around the same price as the PlayStation 2 -- 39,800 yen. Merrill Lynch Japan doesn't seem to think that this will pan out, though. In the latest issue of Japan's Weekly Toyo Keizai magazine, the analyst reveals its expectation that the PS3 will launch in Japan at 44,800 yen. In America, it expects the system to launch at $399.


Merrill Lynch also shares its expectations on hardware costs on Sony's end. Using a figure of 10,000 yen each in production costs for the PS3's Cell processor, the RSX graphics chip and the Blu-Ray ROM drive, the analyst figures it will cost Sony 54,000 yen to produce a single PS3 system. With this figure and the above retail prices, Sony's losses in the first year of PS3 business rise to 130 billion yen.
As a comparison, the magazine offers numbers from the PlayStation 2 era. Sony's games division posted a loss of 51.1 billion yen in the first year of PlayStation 2 business. This was quickly reversed, though, with the following year seeing 82.9 billion yen in profits and the year after that jumping up to 112.6 billion yen.

Will the company follow this recovery trend with the PS3? Merrill Lynch states that it's possible Microsoft will cut the price of the Xbox 360 at the time of the PS3's launch. In such a scenario, the analyst expects Sony to incur second year losses of 80 billion yen, with third year losses coming in at 50 billion yen.



Sourece: IGN

[sweetnupe_6]

Well that sucks. But I guess it's expected.