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PS3 cost reduction doesn't equal $240; more like $300

GZ: Sony has reportedly cut PS3 costs by 70 per cent, but some websites appear to have forgotten exchange rates.

Following Sony's first quarter results for fiscal-2009, the company's executive vice president Nobuyuki Oneda claimed that the PS3's manufacturing costs had dropped by 70 per cent.

Many websites ran with the 70 per cent and applied it to the presumed manufacturing cost of the PS3 when it launched. The problem is that they applied this to the dollar price. This brought the current manufacturing cost to around $250 after the 70 per cent reduction.

However, with the current economic climate and the rising strength of the Yen, applying an original dollar price will not yield accurate results.

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gamezine.co.uk
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meepmoopmeep2997d ago (Edited 2997d ago )

what is on the 18th?

Wizeguy212997d ago

Rumored price drop.

Emphasis on "rumored"

But about this article.. Why prove cost reduction doesn't equal $240 when this is also a rumor?

Their is no way to prove this.. Let's just all wait and see.

PirateThom2997d ago

Sony are holding a three hour press conference. Price drop? Slim? Gran Turismo 5? Who knows what's in store.

Rainstorm812997d ago

Aug 18 Sony GamesCon Press Conference 3hours

not the price drop.

and it cant come sooner to shed light on some things.........hopefully(finge rs crossed)

techie2997d ago

The 70 per cent quoted by Sony themselves is not a rumour. This is on reduced manufacturing costs, not a PS3 price cut. The website is correcting all the bollocks about the manufacturing cost being $240 based on the 70 per cent quote. Did you even read it?

Wizeguy212997d ago (Edited 2997d ago )

Their are rumors of price drop Circling the whole event. I was just being direct. But yea GamesCon. Hmm.. I just want Gt5 release date.

Edit @ Deep

yea I read the article, but my point is the fact that we don't have an accurate number to take away 70%. Even if they do have an idea of cost a while back Sony have tried to reduce cost of the system from the beginning so even tho they may have reduced it by 70%. We can't tell what the answer is since we don't know what the cost is now. Which is why I say pointless. I also guess I shouldn't of used the word rumor. I should say speculation.

Isis062997d ago

that's the day I get my PS3 back from the repair shop?

silverchode2997d ago

its the day sony fanboys will be dissapointed again.

swiftshot932997d ago

lets not get too hyped about the conference. It could just be 90 minutes in German, and 90 minutes in English. Not really 3 hours of announcements...

meepmoopmeep2997d ago

hrm.. cool i guess, i already have a ps3 so a price drop doesn't do me any good.

maybe if a slim came out i'll get one for my sister for Christmas or something

Cwalat2997d ago (Edited 2997d ago )

70% cost reduction wasn't a rumor nore a lie, Sony said themselves that they've dropped the costs with that number.

The unknown is how much a launch PS3 costed, since Sony never said how much it costed to produce one.

Rumor is that a launch PS3 costed above 800$ to produce... If that rumor is true, then the price to produce (shipping excluded) a PS3 should be 240$.

BUUUUT!!!! ... >> No one knows weither or not the 70% reduction is reffered to excisting SKU's or coming SKU's(slim) <<

techie2997d ago (Edited 2997d ago )

Uh...did you read any of this articl?. Why would 70 per cent of the $800 launch price mean $240 now? WHY?

If your answer is "because 30% of $800 is $240", then you obviously haven't read this article and you have no idea about the world around you - where there's been a recession, where the dollar has crashed and the yen has sky-rocketed causing sh*t for Sony and Nintendo.

Sigh.

Edit: fair point Wizeguy21 - but most think it's around 800-900. So $850 is a reasonable guess.

GWAVE2997d ago

I'm actually interested in seeing the proof behind the drop in manufacturing costs. I'm not doubting them. I just want to see the proof, because there have been plenty of "rumors" that Sony got burned for just because an excited journalist caught wind of something and wrote about it (which happens at basically every firmware update).

techie2997d ago (Edited 2997d ago )

The proof is Sony said it in an open conference call? And further that it's included in Sony's financial report - where they say they've reduced the Cell to 45nm? That it's essential and common for Sony to drastically reduce console cost? Because the board in 40gb PS3's is almost 40% smaller than the launch PS3?

RememberThe3572997d ago

The 70% reduction is not rumor. It came straight from a Sony executive. What that means in dollars is unknown. No matter the dollar amount it's pretty impressive considering where they started from.

gambare2997d ago

$300 is good, more than good, you have integrated BD, WiFi, HD, Bluetooh, HDMI ready, free online and *hint* coming soon BC support via firmware update *hint*

the console was worth the $400 but $300 is a steal

Milky2997d ago

So the price could be dropped to £220? Amazing price for a PS3.

-Mezzo-2997d ago

Damn i wan't aware that 18th august good be the day PS3 steals the show.

Gamertags2997d ago

While the price cut is coming, it won't be a huge dent in the total price. It will be some time before we see a comparable (to the 360) PS3 SKU.

Raf1k12997d ago

Which of the 360s SKUs would you compare to the PS3?
The Elite is only £80 cheaper than the PS3 in the UK and that doesn't even come with wifi.

N4g_null2997d ago

I don't understand why does it matter if it is 240 or 300? It is still a drop in manufacturing cost. SONy can choose to keep selling them at the current price if they want to. It would actually be good for them. Gamers don't really care how much the PS3 cost they just want games right?

Another thing is we may not get the drop for some time.

Saigon2997d ago

you will find that the PS3 cost $840 to make for the 60gb and $805 for the 20gb...the 80gb and the 40gb reduced the manufacturing price by 35%...so with the slim...the reasonable solution it would reduce the cost 70%...so that would bring the cost for the high end model to $252 and the cost of the low end to $241.5...so how where the initail reports wrong...especially when the controllers are included in the cost...

blackmagic2997d ago

I think what people are overlooking is that I think he was talking about the ps3 itself... cost of the packaging hasn't changed, shipping and marketing costs haven't changed, cable costs haven't changed and the controller has gone up in cost now that it has rumble... Not to mention that if the PS3 is going to sell at retail for $299 then Sony has to sell it to the retailer for less than $299. The retailer makes money too... The PS3 itself is probably only about 50% of the entire costs incured just to get that product on the retail shelf and I wouldn't be surprised if Sony is STILL losing money at $400. I think people underestimate the value they are getting even at $400.

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Marty83702997d ago

This is just another article pulling numbers out the arse. Just more speculation. Sony arn't gonna release the numbers too the public. So how can anyone know the exact cost.

I mean how can you reduce 70% off a start cost when knowone knows the exact cost of PS3 production at launch.

Ther are so many factors that have to be included from then till now.

Yet non of these sites know, only Sony does.

-Mezzo-2997d ago

300$ is still good enough to kick the competition right off the front.

Cyrus3652997d ago

Good Article, makes alot more sense than the rumored 240 number other sites were throwning around.

This takes account to the stronger Yen, which makes sense in context of the article.

The Question is, is Sony making a profit on PS3 sold now at 399/499, I ask, cause this uses the older 65 nm, which has less cost savings, than what will 45 nm chip.

techie2997d ago

Ah somebody who has some knowledge.

Good question - I'd say they are making a profit at the mo.

RememberThe3572997d ago

Howard Stringer has made remarks comending Nintendo on making the Wii a profitable piece of hardware. Saying that they have done something that he could not.

"The Wii from Nintendo Co Ltd of Japan... attained results that the PS3 hasn't; namely, generating profit from hardware sales."
http://techon.nikkeibp.co.j...

Double Toasted2997d ago

...$50 profit on each Wii a couple of years ago.

peacock12997d ago

The article assumes Sony trades in yen and not dollars. Just because they are japanese doesn't mean they trade in yen does it?

techie2997d ago

They do...that's where much of their losses are coming. A dollar doesn't bring them as much yen as it used to.

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