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5 Reasons The PlayStation Is Toast

DAN SEITZ:

I don’t enjoy writing articles like this. I own a PS3 and I actually think Sony did a lot right this console generation once they got past their disastrous launch. I was deeply skeptical of the PS3 when it first launched and then Sony turned around and made a console that was easy to fix and had a lot of streaming apps.

On the other hand, sometimes you have to read the writing on the wall. The PS Vita has officially become an albatross around the company’s neck, with it and the PSP combined selling a whopping 1.4 million units worldwide last quarter. That alone was enough to drag the gaming unit to a $45 million loss this quarter.

This is just the start: Here’s why.

NastyLeftHook01365d ago

How do you know the ps4 will be sold at a loss? Do you have a time machine? if so, can i borrow it? I would love to see a t rex and how gaming will be 3000 years from now. Not to mention our sun become a red giant, do you have access to that far in the future?/s

Godmars2901365d ago (Edited 1365d ago )

Sony's always worked on the basis of sell the razor at a loss, make it up on the razor blades. Something which generally worked with the PS1 and PS2, but has fallen flat with the PSP, PS3 and now the PSV apparently.

Still a fair even bet they'll, since in every case they did more than simply try and sell a game console, they'll do so again. Though they're just as likely to at least break even this time around with the PS4, given that tech in general isn't high priced or at a breakout stage.

PoSTedUP1364d ago

idk why ppl waste their time on these articles still, they have been around for the PS3 since b4 it launched, now again with the PS4. this isn't journalism. just like fr0sty said below: " [they're just] grasping at straws"

gaffyh1364d ago (Edited 1364d ago )

The stupid thing about all these articles is that the PS Vita hasn't had a full holiday's worth of sales, and it is well known that Sony decided to go for a soft launch for the device in March.

If it doesn't sell well in the holiday period, with a big title such as COD, then it is in trouble.

Also, if we see a PS3 remodel at GamesCom, I don't think PlayStation will have much to worry about for the next year.

BattleAxe1364d ago (Edited 1364d ago )

My opinion is that this generation was a staging ground to get the PSN up and running and to make Blu-Ray a success. Also, this generation Sony has managed to purchase some of the best game studios the industry has to offer. The VITA hasn't been on sale during a Christmas season yet, so I don't think we've seen its potential yet.

When you look at the games coming out this holiday season for the VITA like Assassins Creed, Call of Duty, Playstation: All Stars, Madden NFL 13, FIFA 13, Little Big Planet, Sly Cooper: Thieves in Time and Street Fighter vs. Tekken, its a no brainer that this system is going to sell. I haven't really liked the last two CoD games, but I am definitely intrigued by CoD on PS VITA.

Lastly, with services like GAIKAI and PS HOME, and the fact that Sony owns the rights to a massive library of music (Sony BMG) and TV shows/Movies (Sony Pictures Entertainment), Sony has got to be one of the best positioned companies in the world to be able to take advantage of the digital age. Sony actually led a group of investors and just purchased British owned EMI Music for $2.2 Billion. Once Kaz finishes what he has started, Sony will be the company that everyone is excited about as opposed to Apple.

bintarok1364d ago (Edited 1364d ago )

Gaming ecosystem has been changed drastically for the industry, so it's not constrained to Sony Playstation only.

Like it or not, we're in a transition from current traditional console gen to tablet gen. Just don't believe me now, but it'll be more obvious from 2013-2015 where 28nm multicore SoC GPUs coming up to finally reach Wii U/PS3/x360 graphic performances that leads to console/tablet hybrids (PS4,x720?)

From that point further, all "traditional" consoles/devices will be virtually R.I.P, cloud gaming and tablet wars will be the next big thing.

.02 cents

BISHOP-BRASIL1364d ago

@bintarok

I hope you are wrong.

First because I like owning my physical copies which I can lend to friends, carry around, touch, smell and even sell if I no longer want 'em. And it requires online... Don't get me wrong, I buy stuff in the online services, I use online communits, play online, but I don't want to be required to be online all the time, signing a bunch of agreements to use every game... And I don't even think internet access is anywhere near what's needed yet, specially considering that many of us play for 3 to 4 hours a day and most internet services have a cap.

Secondly because I don't care all that much for portable gaming... In fact I believe we'll always want a home gaming solution despite portable devices eventually getting on the same performance level. I don't know if the console market model will work forever, maybe a more PC like (upgrades) solution take over in two or three generations... But tablets? I don't think they are even trying for the same market.

ShinMaster1364d ago

We already heard this nonsense 6 years ago.

He contradicts himself by saying that Blu-ray didn't sell the PS3, when in fact PS3 helped win the HD format war and "theater nerds" as he calls them, got a PS3 for movies.

[QUOTE]: "This isn’t just Sony’s problem: Microsoft’s got this one even worse"

Yet the flamebait title says otherwise.

knowyourstuff1364d ago

lol Apple has absolutely no reason or interest in console gaming, this author doesn't have a flying clue what he's talking about as per usual.
Also, who cares if you sell at a loss, it's called loss leader, it's a business model that razorblades use as well as tons of other industries, the author Dan Shitz doesn't know shitz about business.
Also, the entire reason Sony and Microsoft are waiting 8 years to release another console is so people would definitely be sick of their old console and be dying for an upgrade. Seeing as how Danny has a short term memory, all previous console cycles were 5 years, not 7 or 8.
Who is to say the next generation Playstation won't have heavy emphasis on digital media or cloud gaming? Danny use your brain, the increase in digital media won't render the PS4 dead, we already have digital media - it's called the PSN and XBL, where you can buy and download games at your whim. If you're a person looking for this service it is already available!
Also, publishers aren't "drying up". Japanese devs will continue to make the same games that turn huge numbers, like Resident Evil, Metal Gear Solid and Devil May Cry, they aren't going to ditch that business model and stick to mobile, that's just crazy and stupid.
Voted Down!

jeseth1364d ago

Author probably doesn't even own a PS3, just trolling for hits.

No hit from me, just another crap article (practially an opinion blog) on N4G.

Next!

Hisiru1364d ago (Edited 1364d ago )

Why do we have articles like this? Who approves this kind of crap?

jadenkorri1364d ago

who approves this crap, the 360 trolls, all I ever see on this stupid site is ps3 fail that, sony fail this, etc etc etc... I don't think i ever seen a 360/MS failed article, they just don't get approved. If sony was doing so bad as all these stupid articles, they would be outta business, but there not. PS3 owners are getting exclusive after exclusive, and we still play online for free. But i guess everyone wants to pay to play online, pay for your internet, power bill... Hey lets throw in some call of duty elite and bf3 premium, what more do you want to pay for too, halo4 online, Uncharted online, borderlands premium. If you had said no to MS live Gold, we probably wouldn't be dealing with all these subscriptions now.

+ Show (7) more repliesLast reply 1364d ago
fr0sty1364d ago

So, let me get this straight, Sony releases PS3, it gets off to a slow start, and then goes on to sell as many units as the console that had a year long head start on it (behind by a couple mil, negligible when looking at the tens of millions of total units sold and still smaller than the gap when ps3 launched). Now they launch Vita off to a slow start, and now we have articles spelling out Sony's doom? The first Xbox lost over $4 billion. 360, while in itself profitable, has not generated the profit needed to get Xbox as a brand out of the red. Where are the doom and gloom articles for Microsoft, a company that just posted it's first ever loss as well?

The fact is, no successful console manufacturer (as in, one that has more than one generation behind them) has EVER gone out of business after one bad generation. Nintendo got spanked 2 gens in a row with N64 and Gamecube, and look what happened to them. Microsoft got beaten with it's own arm when it came to Xbox, and look where they're at.

This article is just grasping at straws.

Razmossis1364d ago

I love it when companies/developers I like make mistakes... it means they LEARN from them!!

A few mistakes this gen will mean a lot of ironing their plan out so it's smooth sailing for next gen.

HammadTheBeast1364d ago

These stupid authors fail to realize that we're dealing with companies that have billions of dollars, stocks, trades, and million dollar consultants and planners. If the guy in his room writing up an article about a company whose game console he bought can successfully predict the outcome of a companies future, than I will accept a perma-ban from the internets.

thezeldadoth1364d ago

nintendo hasn't gotten "spanked" any generation. The n64 and GC did decent, all the while they were blowing away any console sales with their handhelds. The wii and DS both beat every other platform out there.

thezeldadoth1364d ago

its ok, continue to disagree with facts. That'll get you places.

Sgt_Slaughter1364d ago (Edited 1364d ago )

@thezeldadoth The Gamecube getting beat by over 100 million units is pretty much getting spanked...

dcbronco1364d ago (Edited 1364d ago )

Frosty you're missing a ton of information. Sony has done a good job of selling consoles. But during most of those years they were sold at a loss. As late as 2010. MS lost a ton on the first Xbox. Some say over 5 billion. But the 360 has made up for that in combination with Live. Xbox as a product is definitely in the black. Plus if you look back through Sony annual reports, Playstation has lose around 6 billion. Xbox is in a division with a lot of other products. PS was in a division alone for until recently. So while the E & D division may show small profits, the revenue was over 4 billion the last quarter alone and the bulk of that is from the Xbox.

The doom and gloom for Sony is based on the companies health. I wouldn't contribute it to the PS brand at this point since that is a healthier division. But as a company Sony is on the verge of bankruptcy. And it is getting little help from gaming which used to be a very good source of income. If Sony continues to have a bad year it will mostly go into bankruptcy.

I disagree with a lot of the article. Blu-ray hurt, but on price in the beginning and it may be the cause of all of Sony's problems. But the PS3 streams too. Most consoles are sold at a loss. In the past. I don't believe that will be the case this generation. APUs, SoCs and small die sizes will change that. I believe the next consoles will be sold well under cost. Apples not a factor as that is a different market. Publishers are dying but indie, small developers and the availability of Live and PSN, plus things like Kickstarter will open new doors for more people. And the man users will move on because besides the Wii, people bought consoles for games like Halo, Gears, Uncharted and CoD. They are the games that sell the majority of systems and new versions will only be available on the next generation(for the most part).

The author might ultimately be right. But he has the wrong reasons.

oh, and there are no doom and gloom articles for Microsoft because they have around 50 billion sitting in an office somewhere.

theWB271364d ago

There aren't doom articles about Microsoft because as a company, they aren't in nearly a bad as state as Sony as a whole company. I think these articles are cropping up now because of that. I don't agree..cause I think they'll come out of it and Sony will recover. But their ground is alot shakier than Microsofts.

Ryo-Hazuki1364d ago

The PS3 is toast but it outsold the competition last qtr....These articles are funny

Jazz41081364d ago

Microsoft expected loses on there very first console. Sony was a leader and was expected to smash the 360 and its still at the end of this gen not even caught up to if. Ms has not lossed money 17 qtrs in a row like sony has and ms as a company is still very profitable and wallstreet has confidence in ms to stay that way. You just cant say the same about sony as they are bleeding and dying from the powerhouse they once were and no one thay matters in the investing world including japan has confidence in them turning this around. Sorry to be negative but its a bad situation.

nukeitall1364d ago (Edited 1364d ago )

I think dcbronco, has a very good point. The Xbox 360 business is profiting MS hand over fist. Each console sold has provided a profit for years, not to mention accessories, games, DLC and Xbox Live memberships.

On the other hand, Sony has been reducing price on the PS3 to gain market share, but it's pretty much a standstill. Now their gaming division's situation is worsening due to slow PS Vita sales and major contraction on PS3 sales after a price cut.

Nintendo is also on a bad quarter, but theirs are due to future investment on Wii U and Nintendo 3DS not lagging sales. I'm pretty sure they too are making a profit on each Wii being sold and soon breaking even on 3DS.

jeseth1364d ago

Good point Frosty,

Everyone conveniently forgets that PS3 has outsold 360 since it launched, and has been more expensive the whole time ... and 360 had a year head start.

PS3 also gave us free online gaming this gen, way better exclusive games (not even f'ing close now ... hell they even made our PS3's 3D F'ing Blu Ray players.

Sony is fine in the gaming dept. Still selling PS2s and PSPs for crying out loud.

dcbronco1363d ago

360 outsold the PS3 last year so the since launch thing is wrong. And while Sony gaming had a loss this year I do think it is one of their stronger divisions. But the other divisions are so weak that they look like they are going to take the entire company down.

Though all of Sony's problem started with that Blu-ray player you love so much. That barely sells any copies. It sells movies to the gamer crowd because of all the summer action movies. But it is not big in the mainstream and that is what it needs. DVD still owns that by a ton.

And while the 360 was winning sales last year Sony released 6 of those big exclusives. No effect what so ever. Sony should probably break off Sony Entertainment(movies, music, gaming) and give people stock in that and take the rest private of sell it off.

+ Show (9) more repliesLast reply 1363d ago
CmonBeReal1364d ago SpamShowReplies(1)
iamnsuperman1364d ago

The article can be applied to any console really. The big question is why focus on the PS3?

I don't want to be that guy but this "Microsoft is used to fighting Apple and you’ll notice they’re bracing for it with SmartGlass and the Surface. Sony, though, has no weapons and now that it owns Gaikai, making a dedicated gaming machine may be less compelling if you can just work your gaming into your TVs as a feature" is just plain dumb.

Sony are not going to implement their games in to their TVs as it would kill Sony's biggest division (Sony are not stupid). However Gaikai could be used in TVs to make a demand service similar to Netflixs that also can be introduced into their console. I am not sure what person buys a PS3 (or any console) just for its ability to download movies.

HammadTheBeast1364d ago

Mini-games in tvs.

Priceless.

joeorc1364d ago

"Sony are not going to implement their games in to their TVs as it would kill Sony's biggest division (Sony are not stupid). However Gaikai could be used in TVs to make a demand service similar to Netflixs that also can be introduced into their console. I am not sure what person buys a PS3 (or any console) just for its ability to download movies."

Sony is not just only going with "just the Playstation" to sell Playstation Game's now!

That's what the transition they started in 2007 is all about. Look at the Mobile chipset's are capable of, do people not get that?

Those chips are going into TV's, we are talking chipset's that handle DirectX 11+ shader Model 4+, The Idea of the Game console is to sell software for the Living room right?

That's exactly what many companies other than just Sony, Nintendo and Microsoft are going to be doing. At least all three and since we are talking about Sony , right now is being proactive in avoiding the fate like what happened to their dedicated PDA line of Handhelds that was Absorbed by SmartPhones, now dedicated PDA's are pretty much gone except in areas of store's for POS, shelf restocking, etc.

the main consumer went on to Smartphones, Look i doubt anyone really thinks deep down game consoles will completely go away, though what the game console in the future may not resemble what we would call a game console in the traditional sense.

in this 5 reason's he posted this:

"As I’ve mentioned elsewhere, there’s distinct financial pressure on Japanese publishers especially to abandon the console business to the West and just turn out mobile games. That pressure is just going to get more intense. If the Ouya or something like it takes off in Japan, that pressure will be overwhelming."

And Yet out of the 3 companies who is selling the most Smartphones right now?

Nintendo does not make any, Microsoft has not done very well, but that may change with Windows phone 8, but Sony has been selling over 7.2 Million Xperia line smartphone's per sales Quarter, they now Have the Playstation Mobile software platform. that not just only works on their own produced Hardware but also other companies hardware.

Sony for the first time ever will be making in house 1st party development studio's making mobile Playstation Games for the Playstation Mobile software!

That means Sony 1st party Games running on 3RD party Hardware not even made by Sony!..do people not get that?

they are doing that for a reason! the PSVita will run the Playstation Mobile software, that also means it will not only run those games but its own software.

BrutallyBlunt1364d ago

"The article can be applied to any console really. The big question is why focus on the PS3? "

1 - Out of the big players who is doing the worst financially?
2 - Out of the big players who has lost the most out of their previous install base?

I personally don't see the Playstation division being toast. What i do see is a whole new restructuring process and the acquisition of Gaika is one area that will change their direction going forward. The days of creating a game console that is closed off and using exclusives to carry it is not where the growth is. These so called hardcore gamers who post on forums hating where things are heading are the minority now. That's why they are so vocal. What they fail to understand is both casuals and hardcore can co-exist. There shouldn't be these barriers where cloud gaming, social gaming, motion control gaming and so forth need to be categorized.

We've already seen console gaming adapt to things like adding Netflix, online multiplayer, online stores, indie titles and so on. So you either need to adapt to todays times or get left behind and the hardcore gamers are the hardest to convince that change is necessary.

andibandit1364d ago (Edited 1364d ago )

@iamnsuperman

i dont think you quite understood the article. The upcomming war is the fight for the living room, not for the core gamer. TV makers, Apple and MS are all vying for power by implementing the necessary technology. Sony are doing what theyve been doing the last decade, and tho i DO think it will work for them 1 more generation, i think theyll be hopelessly behind the generation after the next.

Casuals outweigh core gamers by ALOT. Software developers WILL follow them if a strong userbase is established by one of the aforementioned companies.

+ Show (1) more replyLast reply 1364d ago
GTRrocker6661364d ago

I want to meet Thomas Paine.....and bang cleopatra

theWB271364d ago

I always wondered if, despite history, Cleopatra was an ugly broad with a ton of charm and history treated her looks a little better.

Zeixama1364d ago

Sony and PlayStation brands are belong to New World Order. They are not going anywhere, always behind you. You don't believe me ?!

shutUpAndTakeMyMoney1364d ago

Why else would $99 consoles be talked about?

Campy da Camper1364d ago

If you are on Earth when our sun turns into a red giant, you will see one serious red ring of death.

dubt721364d ago

Or it could explode as is and create a super Yellow Light of Destruction...

Eyeco1364d ago

why are people even commenting on this stupid article ?, all the points can be attributed to all the upcoming next gen consoles, only reason why Playstation is slapped on the title is for obvious flamebait.

And even still most of these points have been debunked several times some of them years ago (physical media is dead oh noes) Ignore people.

StayStatic1364d ago (Edited 1364d ago )

Consoles are always sold at a loss hence the licensing fees added to a console games price, "Well said" my ass , otherwise consoles would cost the same as PC hardware at launch , thought that would be blindly obvious , but I suppose ignorance is infectious when your favourite toy is criticised.

dcbronco1364d ago

In past generations consoles usually were sold at a loss the first 12-18 month. Nintendo being an exception. The parts are cheaper than PC parts because the console maker usually helps design the parts(even though they are based on off the shelf parts), pays for the designing of them and then shops the production around to the lowest bidder. They also don't have to have a profit margin like a retailer or the manufacturer. AMD or Nvidia might sell a GPU for $400. It might cost them $200 to make or less. The retail markup is probably high because the prices drop so fast.

The other side of that is what happened to Microsoft with the first Xbox. Neither Nvidia or Intel would give them a break on the price of parts so the original Xbox cost MS more than it could sell it for later in the generation. The 360 has to be making well over a $100 per Premium unit now after the die shrinks, combining of parts, shrinking parts and removing parts.

cee7731364d ago

blu ray was $200 in 2006
now its under $12

so not much loss in next gen

ok microsoft showed sony they could compete this gen after the spanking from last gen which was a huge lost for microsft over $4billy jeans this gen they lost over $3billion on xbox 360 but there always in the black but to sum it up microsoft adapted and turned those losses into investment which is what you see here today xbox 360

its now sony's turn to adapt and turns the losses to investment alot of losses were from r&d of the cell $4billi and the blu ray theve won a format war which everyone thought was gonna be beta all over again so thats good investment they get royalties for every blu ray sold now if they can do something with thw cell

WeskerChildReborned1364d ago

Yea, it doesn't make sense to bash something that hasn't came out yet.

LAZL0-Panaflex1364d ago (Edited 1364d ago )

Sony is probably the only one who isn't toast, they got gaikai, Xperia, and they sided with Google. Windows is trying to do their own tablet. Nintendo will be like Sega just hanging there ....making games.

Tablets, smart TVs and streaming is the future. Deal with it.

What's the last thing Jack Denton said at the end of e3?...Sony is always looking for different ways to bring you games and media""
A month later gaikai. Bye bye hardware hello cloud.

SonyWarrior1364d ago

how do you know our sun will turn into a red giant? do you have a time machine?

+ Show (11) more repliesLast reply 1363d ago
smashcrashbash1365d ago

You mean like how the PS3 was supposed to be toast and the PS1 was supposed to be toast? Why the rush to say why the PlayStation will no longer exist? And why bring up Microsoft as a factor? Microsoft's products are always second to something else. What makes this person think that they could ever compete with Apple. They can't even make a decent phone or MP3

blue7_71364d ago

lol no one said the PS3 was toast it was suppose to dominate let alone the PS1 if your going to use examples at least use real ones not ones that you make up.

Anyways yeah Sony really is in bad shape but they can turn it all around I don't think the playstation brand is going anywhere at least not for one more gen and depending on how the PS4 does.

edgeofsins1364d ago

Millions said PS3 was toast. Wii fanboys saying the Wii is the future using new controls and caring about gameplay more then graphics. XBox 360 fanboys were using the old Halo excuses and XBox Live excuse saying the PS3 was crap. This was before launch. No I don't think every fan or customer of any console is automatically a fanboy.

MysticStrummer1364d ago

@blue and the people who agreed with blue - Welcome to N4G. It has to be your first day, maybe not just on N4G but on the internet itself. Many many many many many people said PS3 would fail. Not quite as many, but still a lot of people, said PS1 would fail.

PS will evolve, and maybe go in directions we won't like, but as a brand it's not going anywhere anytime soon.

blue7_71364d ago (Edited 1364d ago )

what are you guys talking about above me. Yeah mysticstrummer welcome to N4G were blind fanboys like you exist. Are you also going to tell me everyone is expecting the Iphone 5 to fail as well lol.

So you are telling me after Sony dominated with the PS1 and obliterated the competition with the PS2 then everyone of course it just made sense for the PS3 to just fail outright like that right.....

It's not like Sony themselves didn't think they were going to dominate again right they just thought it would be fun to launch a year later and at a $600 price point right.

Of course not anyone with a brain predicted it would sell like hot cakes again seeing the fan base it had and how popular the playstation brand was. But like I said you can't talk sense to fanboys.

Revolver_X_1364d ago

@Blue7_7
Its funny how you try to mock ppl and say they're wrong when its quite the opposite. The PS2 era I must admit was dominant, but thats the exception. You obviously dont know gaming history. Oh how they quickly forget Xbots running amuck with claims of the DVD9 destroying Blu-ray. Yet, Blu-ray dvds, players, etc. are in high demand. Even rumors of Xbox720 using Blu-ray is hilarious to me.

I remember similar situation with PS1. Nintendo laughed at the idea of disc based games. Questioning if it was cost effective, and making outrageous claims. BTW, who uses cartridges still? Exactly. PS has been the underdog quite a few times. I see these comments and I can see these trolls salavating out the mouth at the idea of Sony ending forever. Two words. Never Happening. Nintendo , PS, and now Xbox are not going anywhere. Each console has its pros and cons. N4G has always been a breeding ground for pompous trolls who make up so-called facts to help their argument. If ppl say Sony's through, I'll be here to post at the launch of PS5, Xbox1440,and Wii Them saying I told you so.

+ Show (1) more replyLast reply 1364d ago
thebudgetgamer1364d ago

I always love articles that start how much the person likes something only to turn around and smash it.

HammadTheBeast1364d ago

I always love articles that use completely out of context metaphors.

Seriously, he uses the word "Albatross" at least 6 times.

The Meerkat1364d ago

This will sound like heresy to most but Sony and Microsoft might do better together. Their combined pool of IPs on one console would be enough stop Apple from getting in on the act.

Nothing is more important than stopping Apple.

fr0sty1364d ago

At least then we'd have a console that didn't catch on fire, but still let you chat online with your friends even if they're playing another game. As long as they don't start charging you to play it online, or sell you features and them remove them later, I think it'd be cool.

attilayavuzer1364d ago

I think at the very least they should have a cross compatible achievement system. I think they both have too much pride to make a console together though, but I'd actually love for it to happen

GTRrocker6661364d ago (Edited 1364d ago )

No consoles need exclusives. Competition is a good thing in the market. That's what keeps companies striving for more and not settling .

dorron1364d ago

Another "PS3 is dead" article? Very original... Not giving a hit to the author.