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Sony Cuts 8,000 Jobs - Time to Cut the PS3 Too?

With the economy deep in the throes of a recession, the only question these days is who - or what - is next? Today it was Sony's turn, which, citing "the sudden and rapid changes in the global economic environment," said it's laying off 8,000 employees in its electronics division and shuttering 10 percent of its manufacturing facilities.

What this means is too soon to tell, but if you were to ask GIGAOM, they would say it's time for Sony to walk away from the Playstation 3 as much as possible. Its $400 price point is uniquely ill-suited for these recessionary times, and while the company could lower that MSRP, it already loses $130-$260 on each sale (depending on who you believe.) Meanwhile, the Xbox 360 sold twice as many units as the PS3 in October, the most recent month for which data is available (though both consoles trail far behind the Wii.) With the PS3's install base so small in comparison, and the appeal of its highly touted Blu-ray drive questionable at best, it's hard to see Sony benefiting from Playstation 3.

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chaosatom3602d ago (Edited 3602d ago )

The article failed right there.

2-5 million gap is next to nothing.

Wii is outselling both consoles by a Heavy Margin, it doesn't mean that Microsoft and Sony should close their shops and stop producing 360 and ps3.

That would be end of gaming.

Genesis53602d ago (Edited 3602d ago )

With thousand of people at Sony and MS facing permanent layoffs. These petty little fanboy squabbles seem irrelevant, childish and insensitive to both companies employees and families.

Have some sympathy people.

GiantEnemyCrab3602d ago

2-5mil? That is a big gap you have there. So what is it?

It sure as hell ain't 2mil and I think at least 5mil, probably a bit more.

That little gap is not so little but considering what 1.1 says I will leave it at that.

Sorry to anyone that loses thier job, especially close to the holidays. What a way to take a dump on everyones Christmas those heartless SOB's.

Timesplitter143602d ago (Edited 3602d ago )

No, it's not a big gap.

A big gap is 90 million units. The gap between the PS2 and Xbox.

2-5 million gap can almost be seen as ''irrevelant''

But yeah it's sad for those people who lost their jobs near christmas...

Mozilla893602d ago

Because Sony is going to stop supporting their PS3 investment before it starts giving them a profit. I don't remember seeing so many doom and gloom articles about the PS3 and 360 before. They've both made huge investments launching consoles, they aren't just gonna give up like that.

Pixel_Addict3602d ago (Edited 3602d ago )

He is an attention whore. giantenemycrap is on here often enough to know Microsoft is laying off a more than a thousand this holiday, your attempt to lie and manipulate everything is astounding. You are a true sociopath.

Microsoft is hemorrhaging money from every other source of revenue. PC sales are down over all, Vista has been a failure, Zune is a complete failure, their software is pirated to hell, they have yet to match Google, Apple is gaining popularity by each day... even their own gaming studios are being dissolved. Halo 3 and Gears of War 2 are their bread and butter, and I don't see any of those sequels on their 09 line up. Infact I see nothing but filler 1st party titles and multiplatform games.

WANNA GET HIGH3602d ago

Im not a fan boy but i just want u to get ur numbers correct.

360 = 25MILLION
PS3 = 17MILLION

25MILLION - 17MILLION = 8MILLION

So the gap is 8million.It was at 5 when the year began but the price cut has helped the 360.

But i still think this article = FAIL.

mrdxpr23602d ago

um sony might not be losing 100 dolars on each console maybe on the 500 dollar one but the 400 one that one they might just be lossing a little or maybe they just be right there with how much the console costs since with the advancement in technology old technology gets cheaper,.... since teachnology is always changing every 6 months well make the math 2 years thats 4 six months

rucky3602d ago (Edited 3602d ago )

Exactly what Timesplitter said. But despite that huge gap did Microsoft flake out of the gaming industry? Do you really think the Playstation, gaming industry leader for 10+ years, would suddenly bow out the second year it's not ahead?

I agree with you though about the lay-offs. Hope they can make it through these tough times.

Real Gambler3602d ago

Apart from consoles, how many electronic appliances sell in the order of 10 millions unit? NONE. Not even your cheap dvd player, or $59 microwave oven. So by selling over 10 millions units, the PS3 as proved itself already.

Now, when you manufacture an electronic appliance, one of the biggest cost is Research and Development. If they want to offset this cost, the only way to do it is to keep producing the PS3. It's likely about even right now, but eventually, it will only be a question of putting them on the shelf and getting profit. It could be manufactured anywhere. No real extra cost for keeping the product alive. Quick phone call to a manufacture to order more units...

Those guys who are getting layoffed are the people who are designing future hardware. Sure it could be the PS4, but it's more likely the next Bravia or the next BluRay player. No sense of investing in R&D for new products if they won't sell because of the recession. You just keep selling the old products and wait until it's over to re-hire those guys back.

WANNA GET HIGH3602d ago

Is it just me or has bloodmask been submiting alot of ANTI SONY articles lately.... :/

chaosatom3602d ago (Edited 3602d ago )

I still think it's a Five million gap.

here is the reasoning.
Ps3 was up for a while at least the first half, and then 360 was up from first half to now.

Also, We don't what happen to rrod or replaced consoles. That also adds up especially for the 360.

So I don't think the gap has increased or decreased dramatically from last year.

CrazzyMan3602d ago (Edited 3602d ago )

It would be NICE to have PS3 at 299$ or 349$.
Yet, it cost 399$, the same as x360 cost first 2 years. AND Yet, you get FREE online, GREAT media-player and of`course Super RELIABLE console with AMAZING AA games(R2, LBP, VC, MGS4, MR:PR, HS, UnCharted and many other).

OuterHaven3602d ago

just report the user and the articles. its obvious crap.

Danja3602d ago

So Sony cuts jobs , somehow this is suppose to affect the PS3..?

EA is cutting jobs also..should they stop making Maddens , Fifa , and Tigers Woods..also...?

Sony has stated already that the job loses wont affect the PS3..or the games division , especially when the PS3 is almost close to breaking even , the PS2 and PSP is selling so well...

Rhoic3602d ago

"Also, We don't what happen to rrod or replaced consoles. That also adds up especially for the 360."

What does that even mean? If someone goes out and buys ANOTHER CONSOLE.. then it counts as a sale.. seriously? Are you so narrow-minded to the point that only one person can buy 1 console? Also, replaced consoles do not count for consoles sold because well, they're not being sold, they're being replaced.

GrandTheftZamboni3602d ago

You seem right about Bloodmask. I have yet to see a PS3 game review submitted by him that is not below the average score.

morganfell3602d ago (Edited 3602d ago )

Look at a recent comment and you will see it is dead on. Approximately is reads: This is the first month MS has managed to outsell the PS3 since it was introduced. Where were all of the doom and gloom 360 articles?

I think we all know why and by whom this article was written. It is some of the most puerile and idiotic commentary I have ever read.

Stock for both companies is separated by a mere 10 cents. MS makes no money, in fact loses money on the 360 division. Their other and real division, software, is in a mess after Vista. Their biggest single customer, the US government opted not to buy in. If anyone is in a hurt locker it is MS. When Sony is continuing to expand 1st party support, MS is the one killing off valuable assets. Ensemble anyone? That isn't the sign of a healthy company.

If you look how many studios and support mechanisms MS has closed in the past year it far exceeds 8000.

The handwriting is on the wall all right and MS is putting on a nice front. But only shortsighted acolytes are painting a rosy future for MS. Meanwhile these articles gain press through the efforts of panicking MS fans.

fishd3602d ago

Shouldn't it be submitted to the Badjoystick.com?

jaysquared3602d ago

I put this as a reply to canadian and would like for other Sony fans to read it as well. THis is the reason why there's a lot more talks of Sony being Doomed and not M$...

Sony's balance sheet

Total Cash (mrq): 5.77B
Total Cash Per Share (mrq): 5.746
Total Debt (mrq): 11.80B
Total Debt/Equity (mrq): 0.32
Current Ratio (mrq): 1.137
Book Value Per Share (mrq): 36.73

http://finance.yahoo.com/q/...

Microsofts balance sheet
Total Cash (mrq): 19.71B
Total Cash Per Share (mrq): 2.196
Total Debt (mrq): 1.98B
Total Debt/Equity (mrq): 0.059
Current Ratio (mrq): 1.526
Book Value Per Share (mrq): 3.742

http://finance.yahoo.com/q/...

Focus in on Total cash and total debt for each company. You can see Sony has less cash than M$ and more debt. M$ is compeletely opposite having more cash and less debt. So M$ is in a lot better situation than Sony and as everybody knows Sony is still losing money so if that keeps up(and it will) the cash we'll be gone and they will end up needing to borrow more money but as everybody knows as well there is a credit crunch going on and a lot banks are now hesistant to loan out money.

PS3 FTW3602d ago

Sony Cuts 8,000 Jobs - Time to Cut Bloodmask Too?

SRU96003602d ago

This article got me thinking about how many people (Sony fanboys) were saying that 2008 was going to be the PS3's year back in the spring and summer.

I can remember them saying that Resistance 2 was going to sell more copies than Gears of War 2 and that LBP was going to pretty much end the console war. lol

Fast forward to December 2008 and the Xbox 360 is still taking a massive dump on the PS3 week after week.

Sony's Playstation brand had a very good run in the past, but those days are clearly over.

PS3 FTW3602d ago

360 fanboy bragging about how the cheapest 360 is $200 cheaper than the cheapest PS3 are stupid. They also laugh at how Sony says PS3 has a 10 year life cycle and claim that the 360 will be around for just as long. Well let's do some math.

If the 360 last another 8 years like the PS3 that is $400 is XBL fees! If you buy the cheap 360 for $200 and want to play on XBL thats another #100 for the HDD plus another $50 for XBL and if you want to play on XBL for 2 years that's another $50 which totals $400. If you want to play on the highly touted XBL for more than 2 years then 360 is more expensive than a PS3. You can buy a PS3 and have it for 10 years for $400 of you can buy a 360 and have it for 10 years for $700.

PS3 FTW3602d ago

"360 is still taking a massive dump on PS3 week after week"

That's why the PS3 has outsold 360 this overall year. Keep focusing on your temporary spike from the price cut and 2 week jump in sales in Japan due to the RPG flops.

SRU96003602d ago (Edited 3602d ago )

Ah yes, victory is always right around the corner for you PS3 fans.

Someday you will realize that third place is where your console is meant to be. lol

SL1M DADDY3602d ago

The article failed at the title. Sorry, but for anybody that would call themselves a journalist to write such dribble is as bad as the fanboy dribble we see here every day on N4G. Terrible. FUD is getting old these days and all it ever shows us is that fanboys are even more ignorant in their rants than they ever have been.

boodybandit3602d ago (Edited 3602d ago )

is taking garbage articles like this seriously. Why even waste your time debating this nonsense? All these console A, B or C are going to fail or leave the industry articles are usually written by idiots that don't know thing one about business.

The replies to this nonsense on the site where it is written say it all.

PopEmUp3602d ago

had failed in many ways

Saint Sony3602d ago

" The cuts include 8,000 full-time employees, or 5 percent of the company’s electronics workforce, and another 8,000 part-time and seasonal workers, Sony said."

Beast_Master3602d ago

Who isn't cutting jobs right now? I mean we are in an economic slowdown/recession. We are just 40 days away from Obama taking office so then the economy should prop back up by the Spring/Summer! :)

lol...optimism

Mainman3602d ago (Edited 3602d ago )

"What this means is too soon to tell, but if you were to ask GIGAOM, they would say it's time for Sony to walk away from the Playstation 3 as much as possible."

What Sony actually needs to do is embrace the PS3 even more. PS3 is a cash-cow for Sony with its games and blu-ray. Blu-ray will be a significant income source for Sony in the near future.

I read alot that Sony is losing money with every PS3 sold, but I dont know how true this is. Hardware price comes down pretty quickly. What is the cheapest Blu-ray player from a big manufacturer? 200 dollars? Then the Blu-ray diode cant be that expensive anymore and from what I recall the Blu-ray diode was the most expensive or one of the most expensive components in the PS3.

Everybody is saying doom & gloom for the PS3, but the PS3's preformance is pretty impressive. It outsold the 360 in every region despite the high PS3 price, until the 360 price-cut. Sony gotta be happy with themselves.

Edit: Btw, wasnt that MS cutting jobs thing a fake? It was actually Yahoo! terminating 1500 jobs?

house3602d ago

is the dumbest thing ever sony did lose about 4.5 billon dollers but they put alot in the gaming division you think they would pull out just like that no sony knows what there doing they have won two gens so there fine.

TheDude2dot03601d ago

It really is incredible that these console lovers stoop so low that they are happy when a company cuts peoples jobs and hope that another console is gotten rid of.

Why do you care so much? What do you gain from the PS3 being destroyed?

MNicholas3601d ago

Fact: PS3 has higher consumer demand than 360

Evidence: If 360 was the same price as the PS3, the PS3 would sell much better. In fact, when the PS3 was $400 and 360 was $300, the PS3 was indeed selling far better, 35% better. PS3 hardware is actually marginally profitable right now and will be $300 next year. Expect a big sales boost.

Reality: It's Microsoft's 360 that ought to think about closing up shop. Despite being cheaper than the Wii, it's still far behind in sales and falling further behind each month. The "magic" $199 price-point and ripping off the Mii concept was Microsoft's last ditch attempt to transform the market in it's favor and it has had less effect than expected as it went from last in sales to second. At $199 it should not only be able to outsell the PS3 but outsell the Wii. 360 is failing.

PS3 is a huge boost to Sony profitability. The hard part is over for Sony. They've already eaten the development and manufacturing losses and now the hardware alone is just about breaking even ($399) or slightly profitable (@ $499). The PS3 is not only playing a huge role in increasing Blu-Ray's success, it's also the second most desired game console (Wii is ranked most desired by consumers) with massive franchises, many of which are going to show up next year.

Guy writing article is either uneducated in economics/business or has a chip on his shoulder.

jadenkorri3601d ago

especially u SRU9600...fanboys really annoy the crap out of me, because arguing over whos console is better is utterly retarded...Yes fanboys said it was going to be the year for the ps3, well guess what, they were wrong, but its not the year of the 360 either, that was last year, guess who the year belongs too, yes the one and only company who you guys never ever mention, nor mention in your fanboyish rants of who is better, Nintendo, yes that magical Wii, which not only kicked sony with its pants down, but kicked Microsoft in the nads...AT THE SAME TIME TOO, which is pretty amazing... The ps3 outsold the 360 for months, how the 360 is because of the price drop, who knows by the end of the year who will be 2nd, but 3 months is not alot of time for the 360 to catch up... The PS3 sells good, despite its $200 more price tag its still selling. The 360 with all its price drops of course its gonna sell better...

SRU96003601d ago

"Yes fanboys said it was going to be the year for the ps3, well guess what, they were wrong"

You can say that again. lol

+ Show (33) more repliesLast reply 3601d ago
3602d ago
MrWonderful3602d ago

these articles are full of bs. report this crap as spam. ive seen articles about MS and EA cutting jobs today as well, so i guess that means they are going to close up shop for good too?

cayal3601d ago

NFL cut employees, better shut the league down...

Lastlivingsoul3602d ago

This is stupid. Well I hope it is anyway, it would truly suck if I had to go to Microsoft for gaming needs, the 360 is garbage. Working in an electronics store I can definitely attest that 360 and Wii outsells the PS3 handily. But the main issue is price, and that PS3 doesn't have gears, halo or left4dead. In my opinion with a nice large price cut, things would change, but I understand them waiting. I truly don't care who outsells who, but life without PS3 would be very very sad.

etownone3602d ago

Everyone is a winner this gen

NIntendo - casual market
MS - expanded their market share by taking customers away form Sony
Sony - blu ray, nuff said.

Whoooop3602d ago

Loving your intellect...

;)

ThatCanadianGuy3602d ago

"Blu-ray" Nuff said.

Yeah..i guess those 140+ million PS2's. 40+Million PSP's 18+Million PS3's mean Sony is doing soooo bad...

Meanwhile after 3 years on the market (with a full year to themselves)
MS JUST finally passed there previous installs base. a mere 24.million.

But hey..MS is doing fine right? With Millions & millions down the drain in RROD repairs,Vista flopping,paying off third party companys for exclusives that sell like sh*t and end up on PS3.
(Bioshock anyone?)

MS's "War chest" Isn't unlimited.Remember they do have a company to run..

LarVanian3602d ago

NIntendo - casual market
MS - expanded their market share by taking customers away form Sony
Sony - blu ray and innovative games impossible to make on 360 nuff said.

See what I did there?

Rhoic3602d ago

Rofl.. you cant be serious about Microsoft worrying about their money issues in the gaming department. You guys make me laugh. Sony lost 3.5(around that) BILLION from the PS3 launching.. how do you think that did for their gaming department. In fact, Sony lost more money than Microsoft in the gaming department. RRoD came up to be around 1.4 billion.

PoSTedUP3602d ago

wow you guys are really arguing about how much each company lost on producing their consoles? does it not COST money to produce consoles? please stop, that is ridiculous.

FF7numba13602d ago

I doubt the really took much customers away from sony. Thats like saying sony took consumers away from MS. Its to early to tell how successful xbox 360 is it. It barely passed the xbox sales.(i think) Anyways when the 360 gets to 50 million, depending on where the ps3 is, will tell if it was successful or not.

jaysquared3602d ago (Edited 3602d ago )

THis is the reason why there's a lot more talks of Sony being Doomed and not M$

Sony's balance sheet

Total Cash (mrq): 5.77B
Total Cash Per Share (mrq): 5.746
Total Debt (mrq): 11.80B
Total Debt/Equity (mrq): 0.32
Current Ratio (mrq): 1.137
Book Value Per Share (mrq): 36.73

http://finance.yahoo.com/q/...

Microsofts balance sheet
Total Cash (mrq): 19.71B
Total Cash Per Share (mrq): 2.196
Total Debt (mrq): 1.98B
Total Debt/Equity (mrq): 0.059
Current Ratio (mrq): 1.526
Book Value Per Share (mrq): 3.742

http://finance.yahoo.com/q/...

Focus in on Total cash and total debt for each company. You can see Sony has less cash than M$ and more debt. M$ is compeletely opposite having more cash and less debt. So M$ is in a lot better situation than Sony and as everybody knows Sony is still losing money so if that keeps up(and it will) the cash we'll be gone and they will end up needing to borrow more money but as everybody knows as well there is a credit crunch going on and a lot banks are now hesistant to loan out money.

Sarcasm3602d ago

NIntendo - casual market
MS - expanded their market share by taking customers away from Sony because they cant make any good games on they're own
Sony - GOD OF WAR III, Killzone 2, Gran Turismo 5, nuff said

Even if the PS3 goes under and I lose a lot of money on my investment in it, at least I will be able to play those 3 games and call it a day.

etownone3602d ago

when i stated

"Sony - blu ray , nuff said"

That was meant as a compliment. Sony is a winner because of blu-ray. Blu-ray is the next dvd, we all know this, so even if Sony is losing now, they will more than make it up with fiture blu-ray royalties. Even i'm waiting to get my Chase credit card (so i can be eligible to $150 off a sony product of $299 or more) so i can get my ps3...... for the blu-ray of course ( and KZ2 looks amazing )

+ Show (7) more repliesLast reply 3602d ago