Sony's losing money one PS3?

Question

I have now heard from several people on Yahoo! Answers. How can this be possible? I find it very hard to believe, because it makes zero business sense. Please tell if this is true and have some facts to support it.

Answer 1

Well to put it simply, the ps3 cost more to make than they sell it for. for exmaple it might cost 900 dollars make it they sell it for 600. sony is counting on game sales to reap profits

Answer 2

They are losing a lot of money. They cut the prices to increase sales, and are thus losing money with each purchased PS3. It costs more to make them than the are selling for, so Sony is trying to find ways to cut the production cost. They don't expect to start making money off the PS3 until next year sometime. They is actually how systems work, they loss money for a while, but once they become successful, they make the money back in profits (via console, games, accessory sales, etc.) This generation, the companies are having trouble getting to the point where they making money off the consoles. It probably has to do with how ambitious this generation was. The price in console jumped from $200 to $600 with Sony. Eventually, they will be making money. The PS3 has just had a slow start up time. There are a lot of exclusives in the works right now that will help sales. Metal Gear Solid 4 helped to move a lot of consoles.

Answer 3

Actually its more around 300 for the 20GB and 350 for the 60GB. This is because the Playstation3 is packed full with highly advanced (thus pricey) technology. Blu-Ray players today sell well over 1000 dollars. Note that PS3 uses Blu-Ray for their games. And rightfully so, since they can hold like 50GB of data. The Xbox 360 can only use 9GB with a duel layer DVD disc... Only 30GB if they use HD-DVDS dual layers. This didnt seem important, but as we can see with the Japanese 360 game 'Blue Dragon' sequel, which ships with three Discs of highly compressed game files, the 360s storage for discs simply isnt doing it. For future gaming it seems like the developers are going to be needing more disc space; space that t he Blue-Ray discs offer, then some.
Of course Im sure within a few years, give or take, Sony will start making profit on the PS3. Lets just be thankful they're willing to lose money so we dont have to spend 1000s on the console. But just because the console gains no prifit doesnt mean Sony is going to be running low on money. They make money off of games (after a while since it takes a lot of time and money to make games) and gaming accessories. Also Sony has a long line of home entertainment systems, such as TV sets, dvd players, cd players, and even have their hand in the move bussiness. The new James Bond film was produced by Sony, you know.
Just because they lose money for every console they sell doesnt mean they're going to go out of bussiness. Sega made that fatal mistake long ago with the dreamcast. But that was because they released so many game systems and advertised them all. As long as sony doesnt start making a bunch of PSP2s and 3s, they should be pretty safe. Considering that they allow free internet play. Which is probably how Xbox360 makes up for their price loses. Think about it, one console came out a year after PS2, another one came out a year before PS3. Normally that wouldve been damaging, but Microsoft is made of money, so no worries for their pockets either.

Answer 4

They are making desperate attempts, but some ventures are succeeding. PS3 costs 500 for a normal system, and 600 for high power. But here's a funny fact, in case you didn't see it on the news. The company Taco Bell offered $12,000 to the first person to sell them a PS3. In addition, Sony is planning to release only 1,000,000 PS3s total, from what I hear, including Japan. I think that Sony's marketing strategy is going down the drain.

Answer 5

1) Sony makes money on game sales
2) Sony makes BIG money on accessories sales
3) Sony Music ~ Music download sales in the future via ps3 (maybe sony Pictures)
4) Sony Customers means Sony Stocks.

Gaming is a area the console can take a loss because it is a long term investment to have your box in peoples living room. Then the more you can get them to use it wether its for music, movies, or even just games, you increase sales and profits in ALL of the other areas attached to that system.

Dont froget there is also 8,000+ games for the PS2 which will work on the PS3, and each one makes money for Sony.

Answer 6

Its true, there taking quite a beating.

I think its $200 there losing for a regular ps3 and $300 for a higher powered one

and ask mike's answer below me, Nintendo isnt losing money on the Wii, and Xbox 360 is losing money, not that much though but it costs more to make and Xbox then to buy one from a store

Answer 7

thats true with most new items . nobody really makes any money until they have sold a large quantity of their product. with r&d and marketing costs it will probably be a year before they see any real profit.