PS3 Price Cut Still a Possibility?

By Jane McEntegart, published on April 1, 2009 at 10:30 AM
Source: Tom's Guide US | Keywords: , , , , | Themes: Business
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Yesterday Sony made waves with the announcement that the company was lowering the price of the PS2 to just $99.99. While this was better than nothing, the consumer was a little disappointed that rumors about a drop for the PS3 didn’t come to fruition.

Today the Wall Street Journal reports that there still could be price cuts for the PlayStation 3, especially now that the PS2 has seen a price drop. Citing analysts who claim Sony is still likely to cut the price of the PS3, the WSJ reports that Sony needs to lower its PS3 prices for a number of reasons, one of which being the surge in sales that Microsoft saw following the price reduction for the Xbox 360.

However, while analysts are saying it’s likely we’ll see a cut, we’re not so sure. For one thing, Sony is known for harping on about its ten year life cycle and the PS2 was in its ninth year before it dropped down to $99. There’s also the small matter that Sony is still losing money for every PS3 it sells at the current price of at $399. Despite the fact that the console would sell considerably better if it was cheaper, Sony would likely need to implement a sizable price drop before it would impact numbers in any kind of significant way.

How much do you think Sony should be selling the PS3 for? You guys had mixed opinions about the PS2. Some of you said that you’d be willing to pay $99 just to replace your old one; more than happy with the console as a platform you said it was worth the money just to have a newer model. Others said, “what’s the point? It’s as old as the hills!” Leaving aside the PS2, what do you think is a reasonable price for the PS3?

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lamorpa 04/01/2009 4:44 PM
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How about $100. PS2 -> PS3. $99 -> $100

:-)

tenor77 04/01/2009 4:45 PM
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I think we'll see something at E3. Probably $50.
$299 is the sweet spot for the bottom rung PS3 right now IMO

Zoonie 04/01/2009 4:52 PM
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I read an article months ago saying Sony stopped losing money on each console. Partially because of their move to the smaller die size. Is this not correct?

ImmortalJman 04/01/2009 5:00 PM
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Hard to say. Even if the price were to drop there also has to be a reason for the people who already bought a 360. For them, all of the games are already on the 360; the better online community is there; and the only exclusive PS3 game worth playing is Metal Gear Solid 4. The only true value that it has the moment is the Blu-ray feature which use to be the cheapest solution and best solution but now is outdone by Sony's newer players that are selling for 274.99 and are almost as fast as the PS3 at loading movies. For instance, I have my PS3 that I use for Folding@home 24/7 unless I watch a Blu-ray and even then I prefer to watch my Blu-rays on a stand alone unit which produces true 1080p as opposed to the internally rendered 720p image which is then upscaled by the PS3 for output. Hmmmm.... what to do? Sony had a hit with the PS2 before the XBOX came in, but since have really fallen behind of their developments.

LATTEH 04/01/2009 5:16 PM
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if the PS3 was 200 dollars i would save up and buy it other wise i would rather put it in my computer

bin1127 04/01/2009 5:23 PM
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i don't understand why $99 is necessary? $299 isn't that expensive. It's a gaming system to last for years and years. You aren't going to the wal-mart to buy underwear you wear once or twice. This is a blu-ray player to boot; $299 is a very fair price.

As consumers you want the lowest price possible, but with Sony still losing money, there's not much else to ask for pricewise.

Zenthar 04/01/2009 5:24 PM
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IMO the PS3 is better value than XBox 360. It cost more, but if you buy the XBox Wireless adapter, it end-up costing the same, but you still have no HD movie player. If you don't want/need wireless connection and HD movie player, than the XBox is great, but otherwise ...

Then there is the game lineup which can make quite a difference. That is why the PS1/2 lasted that long, not because the systems themselves were THAT good.

megamanx00 04/01/2009 5:32 PM
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As far as I'm concerned one of the main things the PS3 had going for it at launch was it's PS2 compatibility since that allowed it access to a large library of games people wanted to play. Now that feature has been eliminated, and even if it wasn't PS2 games are so old that it wouldn't be considered much of a selling point, and I'm sure that to people who want to play them a $99 PS2 looks better than a $399 PS3 that also plays Blu Ray videos they don't have. Sorry but the PS3 just doesn't have a large library of games, especially of games that are exclusive, that make it a compelling option. I really think that even if they lowered the price to $299 it's too late for Sony to do better than 3rd place. I think at that price it's a good option if you're looking for a blu ray player, especially if you don't already have a 360, but otherwise it just doesn't have the games that are going to make large numbers of players buy it.

danimal_the_animal 04/01/2009 5:48 PM
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philosofool 04/01/2009 5:50 PM
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The sweet spot for the PS3 is being price comparable to the XBox 360. Sony can dream about all the value it adds with blu ray, but this is a symptom of Sony being much more excited about its product than consumers (who would like a format that offers some selection to go with the price tag.)

I think Sony's big issue is that it undercuts the Blu Ray market with PS3s at $300. This means that all the companies that have paid outrageous licensing fees to Sony in order to manufacture Blu Ray machines are now getting direct competition from a product that offers a lot more. Sony can't simultaneously expect people to pay $300 for a blu ray player and a allow people to have $300 PS3s.

Sony is a dumb company that's very bad about getting its products the market share they need to be viable.

Spanky Deluxe 04/01/2009 5:51 PM
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The PS3 is kind of a tough buy right now. If its hd console gaming that you're after then you're better off with a 360, if you want Blu-ray capability then you can get Blu-ray players for under £150 now.

When I bought my PS3 about a year and a half ago, it was a great deal. Mind you, I was buying it as a Blu-ray player first and foremost. Even before I sold the games that came with it on eBay, it was still cheaper than any other Blu-ray player on the market. I don't know what the latest crop of standalone Blu-ray players is like but back then it was the best player on the market. Even now, I think its probably the best player you can buy for a reasonable price.

Hatecrime69 04/01/2009 5:55 PM
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lowering the price on the ps3..now there's an april fool's joke if i ever heard of one!

alberto_lc 04/01/2009 5:55 PM
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If the PS3 was around 249 or max 299 it would be a great buy. You get a BR player and great games. Someone mentioned that the BR 1080p is a 720p upscale is this true?

Anonymous 04/01/2009 5:56 PM
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Sometimes Sony does not make sense, if they kept the BC in any model of the ps3 it would be well worth it's 399 price tag. How do they introduce a system with BC and then take it away when that was a key selling factor. Only reason I got a xbox360 was because it had BC. At 299 purchasing a ps3 with no BC would be easier to justify.

waikano 04/01/2009 5:58 PM
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$299.00 and I would really start to get sweaty palms and start pumping Peanut Butter!!

@danimal_the_animal not everyone has endless amounts of money. And no one really likes a bragger.

theuerkorn 04/01/2009 6:16 PM
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Lower is always better for the customer, while higher is always better for the vendor. Both needs must meet at a defensible price point or the future of the device is jeopardized. In the long run, it doesn't make sense for Sony to sell as many units as possible if they're loosing money doing so. (Obviously not a sustainable business model, and you're just increasing losses with every sale.)

PS3 vs. XBox360 is really not the contest here. Technically speaking the PS3 is superior, but people have their preferences aside from that. (price, games, network ...)

hallic7 04/01/2009 6:20 PM
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PS3 at $299 and more exclusive games and we could see a difference.

I think the ps3 is a great console, I have the old 20 gb model and the quality of the BR movies is awesome (I use a Full HD TV 1080p), but with the lack of exclusive games it was really a letdown.

PS3 can't depend on Metal Gear Solid 4 for ever... this has been happening and well, take that Sony, last place in sales!

tester3000 04/01/2009 6:35 PM
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I wouldn't buy a ps3 no matter how cheap it was... PC all the way!! Plus i just watch HD movies off my HTPC.

SonicMachineHead 04/01/2009 6:38 PM
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$299 is just fine, I'm tired of all the damn poor people complaining about it, the PS3 isn't some kiddy console, thats called a Wii, PS3 does so much more, and it is superior to the Xbox 360, and I don't have to buy addons for wifi and Xbox live service...

tayb 04/01/2009 6:42 PM
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Zoonie :
I read an article months ago saying Sony stopped losing money on each console. Partially because of their move to the smaller die size. Is this not correct?



No. It is not correct. They get pummeled for every console sold and aren't selling nearly enough games to make up for it which is why their games division was in the deep deep red last year despite the PS2 being a 100% pure profit machine.

timaahhh 04/01/2009 6:45 PM
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I think the PS3 needs to get to $250 soon. I think the Wii is way over priced. I love Smash Brothers Brawl, Wii sports, and Mario Cart, but that is about all I like. I think the Wii needs to be closer to $150. I understand why they won't lower the price, but I think it launched $50 over priced. I think the price should have started at $199 and in this stage in its life be dropping down to $149.

garydale 04/01/2009 7:27 PM
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I'm amazed that people buy the X-Box 360 which only lasts about a year before you need to get a new one. Compared to that, any price for the PS3 has to be a bargain.

As for Sony losing money on each PS3, who made that calculation? Typically the cost of assembling these things is small compared to the cost of the chip development.

nao1120 04/01/2009 7:36 PM
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I think everyone forgets the fact that to be able to use every functionality of a Wii, you need to buy the nunchuk, and most like a second controller and a nunchuk, so your already at 400 There, so a 100 dollar price difference really doesn't matter.

Yes, wireless is expensive for the xbox 360, but who cares about wireless. Broadband will alway be more superior because of a constant connection without interference and most TV units and rooms that are new are built with a patch cable jack in mind. At least you should, which im sure would be cheaper than wasting money on wireless everything.

What it comes down to, Sony chose to be different using Blu-Ray in its next gen console. It still hasn't caught up to the real world that people can afford it compared to dvds, and look, the xbox 360 using a dvd format can still pump out with the same titles even on dvd/dual layers.

Granted xbox 360 had the attachment with a HD-DVD external drive, but it didn't take off, because no one cares.

Ultimately this console is great, and 399 is still a bargain for what it offers. But it won't compete when developers, and the fact dvd media is far cheaper. So it needs to reduce the cost to make sales elsewhere on games/media etc etc.

PS2 innovated with the dvd format, but going to bluray this round was a mistake until it was feesable, especially in todays ecomony

Nintendo and xbox 360 pricepoints are acceptable in my opinion.


cracklint 04/01/2009 7:40 PM
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Had sony focused on making a gaming console for gamers, the would be winning the console war by now. But n-o-o-o-o-o-!, they were to worried about winning the hd format war. Had Sony kept their gaming console seperate from blu-ray, they could have a console with a 20 gig drive, no wifi nor media card slots for around 249. People can scream about it's a better value all they want, but the fact is that if 90% of the value to the customer is based on gaming, then you had better be damn good in that department. Gamers ultimately want a next gen console that is affordable and able to play the best games; that is where Sony fails, that is why they are last in the console war. I truly beleive Sony want's to lower the price of their console, but the can't because they would lose too much money. Yeah, the 360 doesn't have wifi, but you can still pick one up and start playing for 199. If you want multiplayer you can spend another $30 on the one month live & 20g harddrive deal. Say, what you will, but that is a lot cheaper than $399. Sony has added options to their console that many consumers just aren't willing to pay for. The Blu-ray functionality of the PS3 may have won the HD format for Sony, but may have cost them the console war.

techtre2003 04/01/2009 7:48 PM
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Wait until holiday season, drop the price $20 and pack in God of War III.
I think that would move some units.

solymnar 04/01/2009 7:54 PM
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PS3's selling points:
Backwards Compatible...gone.
Cheapest Blu-ray player...gone.
Large array of exclusive blockbuster games...hasn't happened.
Large market for people interested in buying and playing blu-ray movies...still hasn't happened.
Graphics and sound...better than wii without question but pretty much on par with xbox360
Online experience...still lagging behind xbox360

The problem with the PS3 is that it has no "must have" features for most people. Thus its marketability by comparison is pretty bad.

Its also a lower quality blu ray player than stand alones now and more expensive. So if you just want movies that's a better route.

Its audio/visual quality in games is effectively on par with Xbox360 but it still cost more and its behind on titles. So if you just want to game with "normal games" the xbox360 is a better route.

Neither has the innovation of the wii and both require an HD TV in order to truly be enjoyed. I agree the wii is over priced. But the price of a decent HD TV blows these consoles away. Its one of many reasons why wii is crushing them. Its targeting the lowest common denominator and doing it very well.

Its only been over the last 4 months that places have really started to have the wii regularly instock, ditto for the balance board. How does slashing their price help if they can't meet production needs? They do sorely need some more "must have" high profile titles imo. But console makers are already planning for the next generation as it is.

Getting back on topic. To be a competitve blu-ray player the PS3 would have to be priced near the lower quality stand alones. To be a competitve gaming system it would have to be priced near the xbox360, get back BC, and have a comparable game selection.

That's a tall order. Doable but unlikely.

michaelahess 04/01/2009 8:02 PM
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I only paid $250 for my PS3, same as I paid for my Wii and PS2 back in the day. Just gotta know how to shop smartly.

danimal_the_animal 04/01/2009 8:06 PM
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I'm not bragging...i PLAN my purchases....when something is coming out that i really like.....i save for it...then when it comes out i buy it.....i don't have ungodly amounts of money....

i do have all three systems, but i subscribe to gamefly.....this way i dont feel ripped of paying 50 bucks a game...when i get bored i send it back and get the next one in the queue...just like netflix.

i can afford these systems because i am financially responsible with my money and stick to my budget...though it kept me from upgrading my PC for a year.....


everybody has something they spend money on...some people spend buttloads of money on clothes...for me its gadgets....newegg is your friend

Anonymous 04/01/2009 8:07 PM
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It's not the money issue for me... it's about them cutting features out of the PS3. What kind of gamer elects to have a machine that isn't all it could (and was meant) to be? Proof of concept is the inflated prices on used PS3 consoles on ebay that support the backward compatibility, etc.

danimal_the_animal 04/01/2009 8:10 PM
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one thing you can do is use the PS3 as a personal computer

http://psubuntu.com/

and the cool thing is you can use a USB keyboard and mouse!!!!!

THAT is a cool feature if you need a PC also!

sure it's linux, but ubuntu is VERY user friendly!

danimal_the_animal 04/01/2009 8:13 PM
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on another note you wont have to be jealous that a game you would really like to play is on another system....how many people here subscribe to gamefly?


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