Playstation Sony Exec: Price Cuts Part of Our Strategy

[devilscallmedad]

Slashing prices was an important strategy last generation, but the cost of manufacturing next-generation has placed that card on the back burner. Right now, Nintendo's the only company that continues to make a premium on each machine sold, and Sony has stated their price strategy will be nothing like it was on PlayStation 2. It's simply too expensive, they said. That doesn't mean they've brushed them off, however. Sony reduced the launch price of PS3 before its release in Japan last year, and that doesn't mean they won't utilize them in the next year. "We may look at the price as part of our strategy to expand the market when the timing is right," said Sony senior VP Takao Yuhara to reporters in Japan (thanks to the Associated Press).
Yuhara also believes the current forecast of a $1.6 billion fiscal year 2006 operating loss for Sony's gaming division may be incorrect -- he speculates the number could be higher. That means Sony's probably fast tracking plans to get out of the red and breaking even as soon as possible, apparently the company's goal for the fiscal year ending in March 2008.
"Such factors, including price cuts to some extent, are factored in" when determining how the company will break even a little over a year from now.

 

[Chandoo]

Sony Preps For Cheaper PS3 Production - 8 Hours Ago

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Quote:
Component reduction costs explored, but will we see components taken out of the console as a result?
Sony explains during a recent investor conference that it is working with its partners to migrate production of key PlayStation 3 components to cheaper, more efficient processes. The nature of the console business has forced Sony to sell the PS3 well below its cost produce, so naturally the company is eager to start maximizing returns with the hardware.
For starters, Sony is planning to move volume production ramp of the PS3's Cell CPU from 90 nanometers to a more advanced 65 nanometer process. This reduction in CPU die size will allow the company to produce more CPUs per wafer, making the process more cost effective. Sony is also reportedly looking into reducing the number of components within the PS3 itself to further reduce production costs, but nothing has been confirmed.
Competitor Microsoft is already expected to shift CPU production for its Xbox 360 console to the more advanced 65nm SOI process, but word has it this plan will see a slight delay to the middle of this year.
Article Link: DigiTimes