Strong yen prompts Sony to lower production costs
by Ludwig Kietzmann 
{ Apr 3rd 2008 at 5:25PM }
While it's true that news involving global financial markets is about as exciting as an English Patient theme park ride, we managed to make it all the way through a recent Reuters article detailing ... something about dollars and yens. Oh, right. At a Taipei News conference, Sony laid out its strategy for dealing with the negative impact the strengthening yen was having on profits, particularly those gained from exports. The manufacturer explained that it would lower production costs and, in the short term, accept a greater number of product orders. With three quarters of its revenues earned internationally, Sony's profits aren't best pleased when the weakening dollar takes a bite out of exports. Reuters notes that for every one yen rise against the US dollar, Sony loses approximately $59 million. We bet that's keeping somebody awake at night.
Reader Comments (Page 1 of 1)
Cyro @ Apr 3rd 2008 5:35PM
Crap!
StarFoxA @ Apr 3rd 2008 5:38PM
Damn you, government!
PojoMofo @ Apr 3rd 2008 5:52PM
That big pile of money is what it is going to take to buy a loaf of bread soon.
Ignatius @ Apr 3rd 2008 6:09PM
Yay, I always wanted to play with thousands of dollars as if it were fake... and the US Government is helping me achieve that dream!
JakubK666 (Ninja Defence Force) @ Apr 3rd 2008 6:27PM
Does that mean that PS3 is teh doomed? Cool.
Neebs @ Apr 3rd 2008 6:31PM
Lower production costs somehow correlates to bad news?
Leonidas @ Apr 3rd 2008 6:35PM
"Reuters notes that for every one yen rise against the US dollar, Sony loses approximately $59 million."
/highlight for emphasis
Ninjakamster @ Apr 3rd 2008 6:40PM
How would the PS3 dying help you? Oh, you want all of its exclusives on the 360?
Debikul @ Apr 3rd 2008 6:51PM
Yeah, I totally want the whole collection of 2 exclusives for the 360. Totally.
ruibing @ Apr 3rd 2008 7:18PM
Only you guys can find something cheerful about a worried economy. Maybe you ought to think about those families have been seriously impacted by job loss and downsizing.
JakubK666 (Ninja Defence Force) @ Apr 4th 2008 9:01AM
@ Ninja
It's nothing against PS3 as the hardware itself is very good.
It's Sony's Bullshit that pisses me off.
Poisoned Al @ Apr 3rd 2008 6:33PM
I think it's less to do with the yen being strong, more the US dollar being shit! (I get paid in fucking dollars most of the time, so I know)
Norm @ Apr 3rd 2008 7:03PM
those are the best kinds of dollars!!
(but srsly, I agree with your sentiment.)
Poisoned Al @ Apr 3rd 2008 7:51PM
Sadly, everyone but the poor old American public saw this coming ("this week in the news, some bad stuff happened, but who cares? Here, look at this picture of cute puppies and don't worry about all that bad stuff! Everything is fine! God bless America!"), so even when the pound sterling isn't doing very well elsewhere, it's still $2 to the £. I can only imaging what the Euro is doing. I bet the French are wiping their ass with dollar bills becuase it's cheaper then toilet paper.
HighFiveJesus @ Apr 3rd 2008 8:45PM
at least fucking dollars has the chance of increasing itself through sexual interest
HighFiveJesus @ Apr 3rd 2008 8:45PM
how punny
ssuk @ Apr 4th 2008 6:02AM
$1.57 = €1.00
$2.00 = £1.00
$1.00 = 102.33 Yen
$1.00 USD = 1.00(6) CAD (Yes, the Canadian Dollar is now stronger than the US dollar. You guys are FUCKED.)
alex @ Apr 5th 2008 9:58PM
Well the yen topped out at ~125 to the dollar last summer and it hit a low of ~96 a few weeks ago I am not suprised they are feeling the squeeze with a 20% move!
Still with most of Asia pegged to the dollar there production costs will be falling so it just the profits that look worse not the basic cost of production and margin on each unit
Mills and Boom @ Apr 3rd 2008 7:33PM
Yey! Sony would be nice enough to pass on the savings to its customers!
But they wont...
el serpiente @ Apr 3rd 2008 8:05PM
Yeah, like Nintendo and Microsoft would play it any different? Take off the fanboy glasses, chump.
Ed @ Apr 3rd 2008 8:23PM
@ Mills
Did you read the article? Our dollar is becoming worthless, They have to drop costs in order to keep our prices from going up. Thats what happens with imported goods when we go into recession.
Ninjakamster @ Apr 3rd 2008 8:57PM
Exactly, in the eyes of all the fanboys here, ONLY Sony can do evil things and ONLY Sony fanboys are the annoying fanboys. Nope, Microsoft and Nintendo NEVER EVER rip off their customers, NEVER have treated them badly nor are their fanboys annoying.
Please, whats with the double standards, the hypocrisy here?
ssuk @ Apr 4th 2008 6:03AM
Well, it would probably mean price drops in Japan. But this is nothing new or unsurprising. Sony
JakubK666 (Ninja Defence Force) @ Apr 4th 2008 9:13AM
@ Ninja
I can see you're a bit of a fanboy but the difference between Sony and MS/Nin is that they stick to their bits bullshit.
MS stated that not all games will work on BC from day one.
Sony claimed that ALL games will work on PS3 and clearly used that claim as one of the selling points.That is before they stopped giving a shit and slashed it completely.
And remember that time when they called Wii a "pointless gimmnick" months before announcing SIXAXIS?
"Rumble is yesterday's technology" - I'm not even gonna comment on this one.Dualshock 3 can make up for a punchline.
John McPoop @ Apr 4th 2008 9:58AM
@Ed
I agree the economy is going towards recession but we have yet to have even 1 Quarter of negative economic growth. Technically a recession is 2 straight quarters of negative economic growth. I live in sort of a nice resort town and I can tell you this looming recession does not affect everyone. The well to do are still out spending like there is no tomorrow. Even I just purchased a house but this is mostly due to money I made off the sale of my last house about a year ago. Its almost free to borrow money right now, interest rates are hovering around 5.50%. In the 1980's rates were as high as 18% and people still bought and sold real estate. I think some good starting points would be to stop spending money internationaly in nation building and preemptive war which is essientially global imperailism. Another thing that would help our country is to have tax reform all across the board especially in relation to income and property taxes. I have to pay about 30% (a little more actually) of the money I make every year to the government. Thats simply unacceptable and I am scared about our prospects in the November election from both parties.
Fun Fact: Did you know when politicians rant and rave about our national defecit being in the neighborhood of 7 Trillion dollars that amount only refers to the interest we owe on our actual debt whch is a shade under 60 Trillion dollars. Our country is essentially bankrupt but we keep borrowing money. If you think its bad now wait until our children's children have to foot the real bill and clean up the big mess.I do not like to come here and talk politics but in this thread its not to much of a reach.
My Plan To Restore Our Country:
Tax Reform all across the board:
Cut the Governments budget by 2/3 (even then its still about 8-10x bigger than it was in the year 2000)
Eliminate the capital gains tax or put a yearly cap on the amount it can be raised.
Less Government oversight
Scale back the IRS (Fun Fact: The IRS will spend upwards of 2 million dollars to go after someone who owes less than $100,000 in back taxes)
Legalize Marijuana and make huge tax revenue
Lessen the standards on felonies so end users of drugs are not encarcirated while the suppliers go free
Spearhead research in alternative energy solutions
Build relationships in the International Community instead of going to war with entire planet
Our country is not bankrupt yet but all the debt we have is owned by China.. At any time they could us on those debts and economy would really crash.... That probably won't ever happen because then China would completely be SOL..
/rant
Demaar @ Apr 3rd 2008 8:37PM
Here's a point: The AUD is nearly worth 100 yen, the highest it's been in ages. Maybe it's time to stop treating us like third class citizens?
hey_big_dck psn:fuliano626 @ Apr 3rd 2008 11:32PM
or not? btw i bet you all should have listed to krazy ken when he told you to get that second job.
Luke @ Apr 4th 2008 1:10AM
listed?
ssuk @ Apr 4th 2008 6:06AM
Justice! There's been an earthquake in Tokyo. Although Science will prove otherwise, I claim that it was the Sony fanbase's anger which has caused this. Take THAT, stronger Yen!
Carl Abrams @ Apr 4th 2008 8:44AM
Okay, I'm confused here. How, exactly, are they going to lower production costs without doing something like cutting what they put into the thing? Or is this some kind of bookkeeping thing, where instead of Sony paying subsidy manufacturer A $20 for a part that costs $10 to make that they're only going to pay them $15? (Which effectively means that they're screwing subsidy manufacturer A on their profits, but since A makes parts only for Sony, they're stuck with whatever Sony pays them.)
Or am I missing how they're going to cut costs on an effectively self-manufactured item?
Ed @ Apr 4th 2008 6:54PM
As parts become more common-place to make their production costs go down. and companies find ways to streamline productions to bring the cost down. Technology also gets streamlined as companies find more efficiant and cheaper ways build their tech to perform the needed fuction. Think about it PS2 went from this high priced monstausity to a cheaper slimmed down compact machine.