Sony: PS3 price cut not due to 'market conditions,' more social networking features on the way

Same here, I don't need facebook integration on my PS3. Netflix (or at least blockbuster) streaming, I would absolutely love.

You can stream netflix through media servers.


The more you know...

Yea, but you initiate that from your PC; it's not nearly as convenient as having a dedicated application running on the PS3.

Oh How I love Linux.....lol....

It works the exact same.

I've done the PlayOn 2 week trial and my buddy has 360 with Netflix. Sadly, they are not the same.

@ Boye

In what region do you live? If you live in the US do you know you can rent movies online through PSN, right?

Yeah Im sure they meant to drop the price by 1/2 3 yrs into the product cycle. If anything this shows how badly they botched the launch but its still a direct response to the market conditions and them being in last place and losing ground (until the slim).

I wouldn't say so, considering The PS3 once cost them over $800 to build, and now, they are able to make a profit off selling a $299 slim. I'd say this is their execution of their 10 year plan, and getting costs low enough to sell at $299 at this stage was probably part of the plan.

Do you have a source quoting the slim as being profitable at $300? Just wondering.

Here's an article on PS3 manufacturing costs dropping:
http://www.engadget.com/2009/07/31/ps3-manufacturing-costs-down-70-percent-strange-it-doesnt-fee/

Also, as far as planning price drops, every console since forever has had a price drop a some point in its life cycle. Planning ahead of time to strategize the best time for it is just good business.

"Costs dropping" is not the same as "making a profit."

Times Online: "It’s well known that Sony loses money on every PS3 it sells. Will that still be the case with the new machine?"
Kaz: "If you're just talking about the hardware alone, the quick answer is yes."

http://technology.timesonline.co.uk/tol/news/tech_and_web/article6808050.ece

I coulda sworn I read an article that said the PS3 is now profitable for Sony...In fact, if you do the math, the PS3 should only cost about $240 to build, and that was PRE slim, which uses less materials, and thus costs less.

The PS3 is profitable as the article posted on Engadget & Joystiq would suggest. Adolson purposely left out part of that answer in what he posted because it looses context and is more sensationalist that way. Reducing manufacturing costs by 70% has allowed them to reduce the introductory price to $299. Sony consistently said they wouldn't lower the price of introduction until they reached profitability on the hardware.

Here is the full question and answer -
______________
It’s well known that Sony loses money on every PS3 it sells. Will that still be the case with the new machine?
If you're just talking about the hardware alone, the quick answer is yes. That makes good headlines, but I don't actually know that that's the true nature of the business that we're all in, whether it's PlayStation, Xbox or the Wii. I think the better indicator is to look at the business as a whole platform, to ask: are you profitable in terms of the hardware, software and peripherals. And the answer t o that question is yes on a gross profit level since the last fiscal year.
_______________

that's because some idiot assumed that a decline of 70% in manufacturing costs means that you could take the old cost of manufacturing a PS3, multiply it by 0.30, and voila, you have the new cost of producing the PS3 ($240). problem is, when sony says that they've reduced their manufacturing costs by 70%, that a very ambiguous statement that's probably meant to pacify stockholders. they could be talking about a particular part or division of production, or they could be leaving out things such as advertising, packing/shipping/distribution, etc.

point is, when you take into account ALL the money that goes into selling a single ps3 and configure it per unit, the ps3 slim is not profitable, apparently. who are you going to believe: the boss of Sony, or a video game journalist with an english major who thinks that he/she understands the inner workings of a business?

When it comes to mass production, there's this thing called "economies of scale" that kicks in which makes a product much cheaper to produce over time and in bulk. We all know that Sony has the in-house capability to do such mass production ever since the PSX first came out in Japan. Since Sony doesn't need to completely retool its factories with each iteration of the PlayStation, the economy of scale kicks in relatively quickly. The only things that would still affect production costs would be the cost of raw materials. Because of the global recession, those raw materials are heavily affected and have become much cheaper for Sony and Nintendo to purchase.

It is my understanding that Microsoft still does not have full control over the manufacturing process of its consoles which might explain why production costs haven't gone depreciated as drastically as Sony's. Of course, other factors do apply such as the fact that the PS3 has moved from a 90/90nm (CPU/GPU die size) ==> 65/90nm hybrid ==> 65/65nm ==> 45/65nm production line (processor dies are incredibly expensive).

In comparison, the 360 went from 90/90nm Xenon ==> 90/90nm Zephyr ==> 65/90nm Falcon (and Opus for those who replaced their Xenons) ==> 65/65nm Jasper.

The price drop attrition is much more noticeable if you look at the computer hardware market.

@johnnynumber5

OH, MY BAD. I thought we were still talking about the PS3 HARDWARE being profitable. Apparently I was wrong, and we are now discussing how the manufacturing costs of the PS3 hardware affect the overall PlayStation 3 platform business...

I think it's safe to say it was a market reaction that was finally able to be made due to reduction costs.

Oops I mean production* costs ...or a reduction in costs. :P

I'm with you.

That would be cool, but maybe it's because I don't own a 360 that I don't get why crossgame chat is such a big deal.

I own a 360, I don't have a live account and I hardly ever play it though, only occasionally for Fable II. So I don't really understand cross game chat all that well either.

How hard is it to grasp this basic concept?

The ability to chat to your friend who is playing inFamous while you are playing Oblivion...

Seriously, I don't even have a 360, and I get why people want that feature. I would like it, myself.

I think "cross game chat" is a bad term anyway. It's not that you can just chat while in two different games, on the 360 multiple people can chat while doing any combination of activities (e.g. playing any game, sitting at the dash, watching a movie, etc...). Perhaps "universal chat" or something similar is a better description.

They should add a telephone to the PS3 so you can talk to anyone.

Im with you, text chat party are boring but at least you can read whats going on while playing...pause and comment if you see something interesting.

Maybe they havent added it because it drains theyre servers ....theyre FREE SERVERS... not like the eggsbox that you have to pay for network playing (and stuff)

"The ability to chat to your friend who is playing inFamous while you are playing Oblivion..."

Why? It's like calling someone while watching a movie, and they're watching a different movie. What sort of pressing, important conversations can't wait, and yet mustn't interrupt your gaming sessions that cross game chat is needed? Is single player too lonely for some folks or something?

I feel the same way about cross game text chat. But I have seen it used, well not the cross game part, since we were all playing the same game, but used nonetheless to allow the only guy in our RFG party without a mike to still be vocal.

Party chat and, for the love of all that is holy, custom music. Lastnight I found out that I'm addicted to Fat Princess, but that damn music.... GAW!!! I want to shove q-tips in my ears!

Define "nobody" for me cause I think your using it wrong.

It's the macroeconomic climate in the Northwestern hemisphere in conjunction with the timeframe of the 10 year lifespan that lead to the specific date for reduction in price for Sony.

Yeah, that's it. Or maybe House is just full of shit.

um you're right....25-29 million people are a LOT of NOBODIES

I worked at Home Depot and bought two PS3's at launch, but I guess I'm nobody.

Lenny: "We need someone else!"

Crowd: "Someone else! Someone else!"

Homer: "I'M someone else!"

Lenny: "He's right!"

Twitter would be really good for clans I think. Be able to send out a message to everyone easily without being PSN friends. Also to people who may not be on their console at that second. Just Tweet "Game X, Sever X, Pass X, time NOW!" once and everyone gets it.

I seriously think that if We dont see the "party system w/cross game chat" implemented in the next 6 months to a year that its simply not possible to do so without taxing the system too heavily....which would be the main reason why we havent seen it yet....

I'm willing to bet it just doesn't have enough RAM.

I seriously doubt that. If 360 can do it PS3 should be able to.