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Sony's PlayStation 3 in race against time

"It's a race against time," said Hiroshi Kamide, an analyst at KBC Securities who covers the $30 billion video game industry. "They must increase their users or it won't be commercially worthwhile for software makers to support it."

The success of the PlayStation 3 is critical for Sony's fledging earnings recovery and a point of pride for the electronics conglomerate, which has already lost the lead in other key products such as portable music players.

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Robert223883826d ago

Another stupid propaganda peice...

How many press releases from around the world saying "PS3 shattering records" and "Fastest selling console in history" does there need to be in order for these people to wake up... Jesus, just look at the math.

THE PS3 IS DOING FINE! It's nothing but uphill from here

More games, more updates, more content, more players.

Lan_EVO_43826d ago

It's like these:

1.Sony is Market Leader
2.It's a Playstation
3.It's a System that got Advantages against the other Systems(Blu Ray, FREE Online, Big Fan Base, Great Titles Coming).

The Only Disadvantage is the Price, that's it. The Best will always get Bashed to Death. That's just Human Nature.

GameJunkieJim3825d ago

A propoganda piece? From Reuters?

You sir, are a truly simple creature.

sajj3163826d ago

It never ceases to amaze me how stupid some of these quotes are. So if you don't have the installbase, its not worthwhile for developers/publishers to support your machine. Ya know, if you don't score the most goals in a soccer game, you won't win the match. This guy should know that you never talk about the lack of an installbase 6+ months into a console's lifecycle.

Ludwig3826d ago (Edited 3826d ago )

PS3 "fabrication" costs are the highest the industry ever seen, it will have to rise a userbase larger then PS2 had to match Wii/360 profitablity ..

In a rough way, every 100 dollars taken away from the retail cost againt the fabrication costs .. is 10 dollars that sony is going to ask per game unit sold for the publishers.

PS3 has between 200-300 dollars in debit .. think how large the install base has to be. That is what he is talking about.

Some info:
- PS2 was 100USD in debit when started.
- Wii is on profit. (Dunno how much.)
- 360 reports range from 100USD debit to 40USD profit.

Games cost 60 .. 30% goes to taxes.. 40 left, sony takes 10-20 .. 30-20 left ..

A game cost roughtly 10-15 million to produce today. 30-50k units per million dollars .. totaling .. 300 to 750k units sold.. just to pay the game .. no profits yet.

Keyser3826d ago

Think about how much it's offset by the PS2 sales. The PS2 is probably almost all profit at this point and it's out selling everything. Out-selling-everything...All that money is offsetting any losses from PS3 sales. They sell what, twice as many PS2 as PS3's (please don't quote me, this is a guess because I'm on a forum and not doing my thesis), if they lose $200 bucks for the PS3 they make it back on the PS2 right? PS2 is still selling a lot of software for all those newly purchased PS2's. Financially it balances out in their game division.

As PS3 sales gain, their PS2 sales will fade. In Sony's interest I would assume they would want it to be at the same rate.

When Analyst do their articles they look at Sony and MS as if it were apples to apples but MS doesn't count on Xbox 1 sales to offset any 360 losses they may have incurred. I would think that Sony does.

This is just a guess anyway...

Ludwig3826d ago

You are absolutely right, but we are not talking about if sony is going well .. we are talking about if PS3 works for the 3rd Parties .. if it can raise profits for them.

You have to look from the publishers point of view.

And don't even think sony can use the PS2 profits to lower PS3 licence cost .. that is not allowed. But as you said, they aren't going bankrupt or anything.

BIadestarX3826d ago

Why do some of you get mad when companies say that Sony needs to increase their install base? It only make sense. This is not an attack against Sony, it is obvious. If they don't have enough people to sell their games it will not be worth while for 3rd party developers. Developers love Sony (Specially) the japanese people and they are loyal some of them are even fanboys(kojima) and will do anything to support the console. Why do Metal Gear and Final Fantasy lack a release date? They are waiting for the PS3 install base to go up. These companies to need to make money. Even kojima is no Mell Gibson, eventually if the publisher (i.e. Konami) is not making their ROI because kojima only want to support the console he likes and choose to ignore other consoles regarless of install base, he is going to have to publish his own games.

Funky Town_TX3826d ago

That is just the way it is. Even if it is true. Lets say even if Sony is loosing money no one wants to hear that. Human nature is what it is.

nix3826d ago

see.. i'm not denying that sony needs to sell more to gain base but it's kinda funny to say MGS and FF producers waiting for PS3 to increase it's numbers so that those games can come out. for what i know - they are 'THE' system sellers!!! The day those games come out there will be thousands buying PS3 just to play it. i am sure Halo had the same effect. people bought xbox to play the game... i doubt Halo producers waited for xbox sales to rise first.

Keyser3826d ago

I hope my comments don't lead you to believe that I was taking it as a Sony attack. I know that all 3 companies are going to be attacked by someone or another. Heck, even by me if they do something that disagrees with how I personally feel they're handling the gaming world. It doesn't mean crap what I say though because MS and Sony are worth billions and I'm not so, who are you going to listent to? :)

I should have mentioned that Sony does need to increase their install base so 3rd party developers will want to create for them. That would be true of all 3 platforms (PS3 more since it's in 3rd place). What's odd is that Nintendo has twice the install base as the PS3 and I don't hear that developers are beating down their door anymore. When the Wii first came out I heard it but not so much anymore. I wonder why. I'm probably just hanging in the wrong circles.

techie3826d ago (Edited 3826d ago )

Well...basically it's common sense. Why would they release a console and not want to increase their install base? Why did they just launch in the rest of the world?

Why does someone make a console!? To get a big install base so they can get good software on it...hmmm maybe

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