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PS4 CUH-1200: Price Drop Incoming

GGG makes an argument for why they think that Sony will drop the PS4's price when they eventually release the new CUH-1200 PS4 model in the west.

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mrbojingles879d ago

I've got a few friends on the fence about buying PS4s. With Uncharted, MGS and Fallout I'm sure a price cut would push them over!

loopygames879d ago

I don't think Sony will drop the price on this new revision for the PS4. Once you drop the price, you can't raise it back up, just ask Microsoft. Kaz has already made it a point that profit is the #1 priority over marketshare for Sony.

mrbojingles879d ago

But what if this new model is even more profitable? Let's say they were making $30 off every other PS4 and now $60 off this new PS4, they could cut it to $349 and still make a decent amount of money per unit and profit a lot.

I imagine they have to drop the price before Morpheus hits in the first half of 2016. Morpheus will be expensive so it needs the PS4 to be as cheap as reasonably possible to be successful. I imagine they'd rather sell Morpheus at a $50-$100 profit per unit if it means selling the PS4 at a $20-$30 loss.

loopygames879d ago (Edited 879d ago )

If your #1 in sales worldwide with no signs of it slowing down, you do not drop the price, even if you find ways to reduce production cost. You save it as a weapon of last resort to boost sales.

mrbojingles879d ago

@loopygames

Its kinda a chicken and egg situation. You try to keep price as high as you can for more profit if you're selling well but keeping a higher price will inevitably effect the long-term chances of selling well. Think PS2's May 2002 price cut from $299 to $199. Sony didn't need to but they got the system to a point where they could sell it at a small loss and make more money on software.

Also, there are signs of slowing down. Minor but there. I think PS4 sales were down year over year in April and May in the US. We'll have to see how June goes. If sales in 2015 are lower than 2014 in a major region, that means they are slowing down. You might think 15M units isn't so bad even if it isn't 18M units, but I'm sure Sony's investors want that extra 3M real bad.

Baka-akaB878d ago

I have a feeling they'll want to keep that drop for when MS announces theirs on the XB1 ... or even Nintendo's on Wii U

stuna1878d ago

Why you got disagreed with who knows? But your argument is actually compelling. It would make perfect sense to drop the price of the newer model PS4, economically it would make consumers think they are getting a bargain especially once Morpheus does come out the difference in the price will be easier to justify the puchase of both a PS4 and Morpheus. What people neglect to mention is that when the PS3 first released it was over $700 after taxes and yet people still shelled out the money to get one! I know because I was one who got one.

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BitbyDeath878d ago

With the revisions it will allow for the price to be dropped and still receive the same profit off each whilst at the same time selling more due to a lower price which will increase profits overall.

mrbojingles878d ago

I don't know why people think this isn't possible. The idea behind this new model is to cut costs. Let's say each PS4 unit is $360 and this new model is now only $330. That means a $349 SKU will still make them some money. You have to strike with price cuts BEFORE sales slow to keep them going. Especially if MS does a temp price cut with Halo 5 for the holidays down to $299,Sony would need to drop to at least $349 to not lose their entire lead in the US in two months.

PhoenixUp878d ago (Edited 878d ago )

Even with all the crazy deals Microsoft is giving away with Xbox One, PS4 is still 1 million ahead in the US, not to mention completely dominant in the global market. Sony can afford to put off the price cut until Halo 5 releases since the upcoming bundles can carry the platform.

mrbojingles878d ago

I think its a 700k lead in the US, not 1M. If MS outsells them like 400k-500k during the holidays, like last year, that gap could be gone quick.

SoapShoes878d ago

It was 700k in January's start. Now it's likely quite a bit higher.

PhoenixUp878d ago (Edited 878d ago )

PlayStation 4 sold 8.65 million and Xbox One sold 7.79 million in North America by the middle of May. That gap would've increased dramatically by now towards the end of June with the Arkham Knight bundle. The gap should be more than 1 million right now and would grow more during the rest of the summer. The MGSV bundle in September will also dramatically increase sales gap along with the other major collaborative deals Sony has planned for the holiday season. It'd be difficult for Microsoft to catch up then surpass them, especially when Sony decides to finally officially drop the price. If the marketing blitz Microsoft is doing now isn't enough to put them on top, then its unlikely to be more effective than Sony's during the holiday season.

iliimaster878d ago

this would make sense only because in the next 7-11 months they have no major game release

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