PS3 to make or break Sony forevermore

by Nick Doerr { Aug 1st 2006 at 3:30PM }

More recycled analysis brought to you by Bloomberg. A key point to keep in mind: Sony predicts a 5-year recoup for losses due to the PS3's manufacturing costs and price point. That's going to hurt, especially since the average console life is around five years (a few exceptions noted). Masafumi Oshiden, from Merrill-Lynch, said "PlayStation 3 will be a huge money loser in the beginning." Spoken adequately enough. It's true -- we all know it's going to be very hard for Sony. Estimates show that about 200 billion yen was invested into the development of the cell processor alone.

Another point to keep in mind is the notion that "Sony's PlayStation 3 introduction in November may be hampered by fewer and less-powerful games because the company hasn't given final technical details of the new console, according to video-game publishers." So, is delivering 10,000 dev kits not going to cut it? Will IBM be able to pull better yields for the cell processor in time for the PS3 launch? If not, Sony won't even have the chance to recoup in five years -- they may pull the plug sooner than that, unless we give them our support.

Tags: blu-ray, cell processor, CellProcessor, Howard Stringer, HowardStringer, Playstation 3, Playstation3, PS3, Sony

Reader Comments (Page 1 of 1)

Cage @ Aug 1st 2006 3:58PM

"they may pull the plug sooner than that, unless we give them our support."

So games will no longer exist without Sony? You would still find the games you love (FF, MGS, etc) whether Sony had a console or not. People dont buy the 360 just because its made by Microsoft. They buy it because of what it can do. From your words it sounds like you MUST support Sony no matter WHAT kind of product they throw out there...

SuicideNinja @ Aug 1st 2006 4:02PM

"they may pull the plug sooner than that, unless we give them our support"

If that happens, I sure hope that the associated games don't go with them. I support the games first and foremost.

Say Sony were to drop out of the console business due to a failed PS3. Who the hell would replace them? Microsoft and Nintendo duking it out just wouldn't be right; there would have to be a third contender. Sega is sure not ready for a comeback.

Anyway, it should be obvious at this point that technical hurdles will be present, no matter what. However, Sony will be able to pump out PS3's, and likely not fast enough at first. The only difference I see this generation is that they may not have as big of a lead, if they even still retain leadership. But complete failure just doesn't seem likely.

OkayItsMe @ Aug 1st 2006 4:21PM

If Sony were to pull the plug on the PS3 it wouldn't be because they wanted to, it would be because the company itself is in financial trouble. There's no doubt that if the PS3 is given a long life, has adequate developer support, and the price decreases over time to where it's more reasonable, that the console will be successful.

It's the initial roll out that will be the most difficult. Sure the early adopters will grab the console right away. It's the sales after the first couple of months which everyone is going to be watching.

If for some reason the PS3 weren't successful, it not only hurts Sony gaming, but also the Blu-Ray effort, which is largely hinging itself on the PS3.

gfella @ Aug 1st 2006 6:45PM

this just gets me thinkin' that perhaps Sony is thinkin' longevity and that the PS3 is really something powerful. Perhaps Sony is thinking console shelf life, rather, PS3 shelf life to be longer than the standard 5yr mark. It was said by Ken that the PS3 is a computer of sorts in that it will be expandable. This sounds to me that I would be investing my money in a product that's gonna be around for almost as long as my LCD TV(average 10yrs. At this point it seems to be unknown the full potential of the cell procesor, but the demo i saw where the car is being shot up and ripped to shreds by a hail of bullets then exploding, or the gas station thats exploding, shooting shrapnel and debris all over the place, says a lot about the processor. The processor was doing all the work without nvidia's graphic engine. Not only that, they showed the processor to running multiple windows of HD streams all showing indepent content(i think there were something like 12 streams runnin simultaneously), todays current processors struggle to run one stream. It just shows me that 599 just doesnt seem to be that much to invest in an entertainment console, what i think is, of the future. I see it as an adjustment of gear ratios of a race car; PS3 gives up acceleration for the higher topspeed, where as, xbo360 has the faster acceleration but probably lackin the topspeed to get through that long straightaway to the finish line. Time will tell but as you can see, you know which car i'll be driving.

Anthony @ Aug 1st 2006 6:50PM

The sad fact is that people will buy this system simply because they are blindly loyal to Sony. Sony is riding on their name, they don't deliver what they say they will.

Playstation 3 summarized:No must have titles, no online setup that can come close to the $>1 Billion Xbox Live, very minimal power superiority to the 360, games being canceled due to the complex nature of the development along with cost,delays,then finally the COST OF THE SYSTEM...for what!? If you want to brag about how you've got all these old games, then play them on the ps2! You want to stick with the old outdated stuff,then do it! You don't need a new platform to do that! I choose to move with the times.

There is absolutely nothing that is a must have about this new system. Remember when Sega had the 60% share of the market, just as sony does now? People back then recognized sony had a better system (PS1), and adapted with the times.

Now its Xbox's time. Love Microsoft,hate them, I don't care,but buy the better product for your own sake!They have all the developers, plus they bought out a bunch of them last round, they were looking at the long-term,now you can see it. Are you Sony fanboys really going to spend $600 just to be part of the crowd?

Fan @ Aug 1st 2006 7:09PM

"There is absolutely nothing that is a must have about this new system."

Right... If none of these titles are must haves then you just have bad taste.

Motorstorm
Heavenly Sword
The Naughty Dog Project
Final Fantasy
Assasins Creed
The new game from the people behind ICO and SOTC
Metal Gear Solid 4
Resident Evil 5
Grand Turismo 5

Not to mention the tons of original Japanese games that pop up. Im just totally disagreeing with you. Further IF playing games online is free on the Playstation it will be another selling point among many.

Anthony you post is just so ignorant it hurts. I would never ever buy anything just because a company made it. But yet I am excited about the Playstation 3.

Cage @ Aug 1st 2006 7:44PM

Motorstorm and Heavenly Sword = 2 games that absolutely MUST be hyped up due to being launch titles. They remind me of the hype from Perfect Dark. Prepare to be dissapointed.

Final Fantasy and Metal Gear Solid = Games most people look to as the heart and soul of the playstation. Its too bad they wont be out till late 2007. A LOT of people will be waiting till then...if they wait.

Assasins Creed = Port

Resident Evil 5 and Grand Turismo 5 = Are people really excited about another rehash? When does this ever get old? At 7? or how about 8? I think its 8. Only 3 more versions to go.

Fan...from your posts I understand that from your previous posts the PS3 is the second coming. Just please dont:
1. Throw games that are most likely over a year away into reasons to get a PS3 NOW.
2. Include titles you only see screenshots and bad videos from.

Cage @ Aug 1st 2006 7:48PM

"from your posts I understand that from your previous posts"

That made absolutely no sense. But you get my point.

Fan @ Aug 1st 2006 8:23PM

"Motorstorm and Heavenly Sword = 2 games that absolutely MUST be hyped up due to being launch titles."

They are not launch titles. Motorstorm MAYBE a launch title in Europe. So no you are mistaken and they look great, both of them. Check out the HD gameplay trailers at gametrailers.com

"Assasins Creed = Port"

AC is NOT a port. Where do you come up with this shit? Do you make it up just to come up with nonsense arguments? AC is beeing made for the PS3. If it comes to other systems then it will be a port to those systems.

"Resident Evil 5 and Grand Turismo 5 = Are people really excited about another rehash?"

Well RE5 is not a big deal to me but GT5 could be very sweet indeed.

Also you left out The Naughty Dog Project whitch is looking very very good you should check it out. Also you left out the new game from the people behind ICO, but thats more understandable since it has not been announced. Im hoping it will make a show at TGS.

And Cage I never ever said the PS3 is the second coming or whatnot. Im primeraly a PC gamer not a console gamer. I just live on planet Earth unlike you.

Cage @ Aug 1st 2006 8:45PM

http://www.joystiq.com/2006/07/25/assassins-creed-for-xbox-360-gets-previewed/

Didnt mean to say port. Muli-platform. My mistake.

If Motorstorm and Heavenly Sword arent launch titles then WHY in gods name would you buy a PS3 this Christmas. This has to be the DUMBEST purchase someone would make.

Haven't checked out the Naughty Dogs Project. Will look into that. If its on Halo level (as far a carrying a console at launch) then you might have somethin. If you are primarily a PC gamer then how does the PS3 appeal to you? (Pretty expensive to keep up a PC and have a PS3)

Fan @ Aug 1st 2006 9:27PM

Its a good thing to admit mistakes, maybe you will learn from it.

"If Motorstorm and Heavenly Sword arent launch titles then WHY in gods name would you buy a PS3 this Christmas. This has to be the DUMBEST purchase someone would make."

Please point me to were I say I will be purchasing a PS3 this christmas? If Motorstorm is a launch title then I will prob pick it up with Resistance Fall Of Man if I can use M+K on it. If not, ill prob wait unless som cool launch titles are revealed at TGS.

"Haven't checked out the Naughty Dogs Project. Will look into that. If its on Halo level (as far a carrying a console at launch) then you might have somethin."

I might have something what? I not looking to convince you to buy a PS3, I dont care what you do. TNDP will be out on the PS3 and it looks like I will buy it when it comes out, that is all...

And again you just show you know nothing about the PS3, you just hang around to flame and close your ears to anything positive.

Here is a link to the Naughty Dog Project:
http://www.gametrailers.com/player.php?id=10433&type=wmv&pl=game

And just to show you how Motorstorm is coming along look at this:
http://eu.playstation.com/ps3/hd_video.html?images/Motorstorm.mov

"If you are primarily a PC gamer then how does the PS3 appeal to you?"

The PS3 appeals to me on many levels as a PC gamer. Not only do I get a livingroom computer complete with a linux distro, I get a high capacety disc drive and a kick ass processor for a price that is extremly resonable when you compare it to what it would cost to build something similar yourself.

The PS3 is using open technology, everything from the HDD to the bluetooth controllers use standards which means that I can connect the hardware of my choice to it. Like for example the 200gb toshiba HDD:
http://www.engadget.com/2006/06/05/toshibas-200gb-2-5-in-perpendicular-drive/

With this I can fill up the HDD with anything and when its full I can just put it in my computer and get a bigger one for the PS3. Or I can buy a casing for it and leave it external.

Now as mostly a PC gamer the most important feature is of course the ability to play the awsome games that are coming from my couch....

scab @ Aug 1st 2006 10:44PM

@anthony
you made that same exect comment on a previous post
so if you got no new arguemnet than stfu
and as for the 1 bil xbl 900mil is from halo2 which is a current gen game so stfu u piece of fanboy shit

ndoerr @ Aug 2nd 2006 1:59AM

@ Cage (#1 comment) -- I never said anything about gaming not existing without Sony. I simply stated that if the numbers don't meet expectations, Sony may drop the PS3 out a very tall building before it can recoup money. It's not rational to keep a losing system longer if it's just making a greater loss for the company.

Seeing how this is a fanboy site, many people who come here do support Sony and love what they've done. It would be sad to see them vanish from video game hardware, but not the end of the world. I still hurt over Sega's retreat from hardware, but it didn't turn me away from other systems. It shouldn't work that way, so forgive the poor wording if it really were so pointed.

KawF @ Aug 2nd 2006 3:45AM

Playstation 1: On market and selling for 10 years, 11 actually I think. Basically that means that they had probably 6 years of nothing but PROFITS coming from that system, selling millions of units.

Playstation 2: Will be on the market still after PS3 is released, and my prediction is that it will have a 10 year life-span as well. Again, ensuring 5 years at least of nothing but profits.

Playstation 3: Do you see the pattern?

Sony doesn't just grind everything of the "last generation" to a halt when the next gen comes along. If you can't afford a PS3 but still want to play great games that are associated with the Playstation brand, buy a PS2. Don't have an "expensive" HDTV? Buy a PS2!

Some really great games have come out for it, and will continue for a good ammount of years to come out for it.

Had it not been for the fact that I have saved up for a PS3 to play PS2 games on as well, I'd have bought a PS2 too. In fact, I placed a pre-order the day the offer came. Cost my $0. I'm even getting an "exclusive" box of pre-order material for that. Yes, $0, Free. Sweet.

Mutsch @ Aug 2nd 2006 8:06AM

* Sony made money with every consoles so far.
* Microsoft so far only lost money big time.
* Sony talks about getting back the money they have invested into the PS3 (dev, prod) within 5 years with a couple of years still to go after that.
* Microsoft talks about being positive from an operating profit point of view in 2008 with a product lifecycle close to 5 years.

Big difference if you ask me, but you don't ask of course ;-)

sputnik @ Aug 2nd 2006 8:21AM

Motorstorm
Heavenly Sword
The Naughty Dog Project
Final Fantasy
Assassins Creed
The new game from the people behind ICO and SOTC
Metal Gear Solid 4
Resident Evil 5
Grand Turismo 5

NewsFlash for Fan:
Final Fantasy, Assassins Creed, Metal Gear Solid 4, Resident Evil 5 are all definitely or very likely going to show up on the 360. Assassins Creed and Resident Evil 5 and Metal Gear Solid 4 are on the definite list. For Petes sake...Assassins Creed was running on a 360 at E3...It's probably the main development platform for the game. Remember Fight Night Round 3 was shown as a PS3 title at E3 05...but it's out on the 360 since February of 06.

All the Metal Gear games have eventually made it to the Xbox...why would 4 be any different? And with the 360 projected to lead console sales for at least 2 years and maybe altogether this round...more Sony exclusives are likely to make it to the 360 and much quicker this go around. Ex.: Grand Theft Auto...many developers simply cannot ignore the 360's lead...both real and projected this time around.

I can't believe your boasting in Motor Storm or "The new game from the people behind ICO and SOTC". Fancy visuals and lots of hype do not a good game make (ex. Perfect Dark for 360). We haven't even seen anything but E3 tech Demos of Motor Storm.

It's now August and Sony still is Mum on what sort of on line experience gamers can expect from the PS3. We haven't seen anything in any tangible form as to how they will deliver on their promises in the online arena. I doubt we'll even know what the hell their doing in November when the PS3 is released. Pre Orders begin in Sept...when are they going to inform consumers?

MGS has pledged $50 price tags for it's games...(Fable 2, PGR series, Forza Series, Kameo, Halo Series, Gears of War...etc) while Sony execs say more than $60 is possible for PS3.

HD-DVD is eclipsing Blu-Ray in Price, Visual Quality, Demonstrated Capacity and # of Titles Available.
http://arstechnica.com/news.ars/post/20060801-7399.html
http://www.thedvdwars.com/index.cfm

And that price tag! Wow!

Fan you seem to make many reasonable arguments...but your support for this console is just unreasonable.

Andir2.0 @ Aug 2nd 2006 9:00AM

Why is there such an outcry that Sony will fail? We all know the truth, the PS3 will be a success. I could care less how much it cost. Nintendo will sell niche systems. I for one will not buy one, I don't like having to move all around my living room to play a game. My couch is just fine. XBox360 only has Live. Nothing else on the system impressed me at all. The system banks too much on software (as it is Microsoft). Titles showing now not using a third of the power of the Cell are comparable to 360 games. Where does that leave the titles directly made to utilize the entire processor? BluRay will be the next "thing" and developers will develop for the Cell. Those are all facts. Feel free to quote me on this come August next year.

The only place I read anti-Sony crap is on blogs. You all need to get a life outside of Sony bashing. Seriously, you have nothing better to do than come to a clear fanboy site and bash Sony? I'd say they already one if you feel so fervent in disproving them. I'm not on 360 Fanboy making rediculous claims there. Just go away and accept your new overlords. For a system that you care so little about, you sure do talk about it enough.

Fan @ Aug 2nd 2006 9:31AM

Hi sputnik

"All the Metal Gear games have eventually made it to the Xbox."

No. MGS3 was not released on xbox sorry you are mistaken. Also MGS2 was released over A YEAR later on the xbox. Have fun waiting for that one.

"Assassins Creed was running on a 360 at E3"

Again this is not true. It was running on a PC. This rumour was thrown out as nonsense along time ago.

"Final Fantasy, Assassins Creed, Metal Gear Solid 4, Resident Evil 5 are all definitely or very likely going to show up on the 360."

Like Cage. Were do you come up with this shit? Do you have any links to verify your claims? Im guessing not.

Anyway, I agree that AC is coming to other consoles. My GUESS is that its a timed exclusive so youll have to wait for that one if this is the case. Nobody really knows.

As for Final Fantasy. Its not coming to Xbox, forget it. Show me a link, anything, that even remotly speculates that the FF series is coming to xbox. Sorry.

Resident Evil 5 is SPECULATED to be a PS3 exclusive. Its not confirmed anymore than its confirmed that AC will hit xbox. Listen to this podcast: http://zdmedia.vo.llnwd.net/o1/Podcasts/072806.mp3
Exact quote is: "I don't know a lot, I don't think this is going to be announced, this is just pure speculation from me based on intelligence I've gathered: TGS...Resident Evil 5...PS3 exclusive..." So ill guess we have to wait for TGS.

"I can't believe your boasting in Motor Storm or "The new game from the people behind ICO and SOTC". Fancy visuals and lots of hype do not a good game make (ex. Perfect Dark for 360). We haven't even seen anything but E3 tech Demos of Motor Storm."

Wow again you show you know nothing. READ my above post and I posted a realtime gameplay demo from Motorstorm. Ill post it again so you wont have to search:
http://eu.playstation.com/ps3/hd_video.html?images/Motorstorm.mov

This is not a E3 video..... Anyway, I dont boast I simply show you the facts. I do agree with you that mentioning the new game from the ICO crew is a little premature, since it has not even been announced, but I love those guys and im excited to see what they can come up with.

Yes we do not know much about online. But the console is not out yet, we will know when it launches. The same goes for prices on games, we will know what they cost when the console launches. And I really dont care about the movie wars. The PS3 can play dvds and thats good enough to watch movies on. If I absolutely need a HD movie player ill go get a hybrid one.. Maybe when I can afford a HDTV=)

"Fan you seem to make many reasonable arguments...but your support for this console is just unreasonable."

Is not this quite a contradiction? I make reasonable arguments but my stance is unreasonable? You lost me.. Anyway I do not think it is unreasonable to think that the PS3 will be a good console. It has lots of good games in the works, it has a history of delivering, it has many of the most talented developers backing it and it has the best hardware of the three. The only downside it has is the price. So we will have to wait and see how the general consumer reacts to the price.

PS3 needs good press @ Aug 2nd 2006 11:54AM

Fan is right. When it all boils down, the only thing that is against Sony at this point in time is the price of the console. Will it be too high for the casual gamer? Looks like. Initially, even as a hardcore gamer, I would say the PS3 is not worth a buy this holiday season. It just isn't. No matter what way you slice it. But, come 1-2 years after the release, the library of games should be impressive and hopefully the Cell power will be tapped.

The PS3 is a promising machine, make no mistake. It's just ahead of its time at the moment.

Cage @ Aug 2nd 2006 1:39PM

"Like Cage. Were do you come up with this shit? Do you have any links to verify your claims? Im guessing not."

I give links. Check my post. We all know Assasins Creed wasnt running on a 360 and we know that MGS and FF arent coming to the 360 anytime soon. No need to have the angry tone in your posts Fan. I understand that you have to defend this beast at every turn but this is YOUR fanboy site. Relax. There are others with you...

The PS3 would actually be better off launching next year when it ACTUALLY HAS GAMES. They just couldnt afford to give MS a 2 yr head start. Why someone would buy it this Christmas? I have no idea.

Kyle @ Aug 2nd 2006 1:59PM

#17 Andir2.0
Ha ha ha! Don't you know? The Sony bashers have nothing better to do than flame fanboy sites. We can go play our great games, but they're just waiting for an online game to get more players so they can play for ten minutes. Of course they're disgruntled.

Tox Max @ Aug 2nd 2006 8:00PM

* Sony made money with every consoles so far.
* Microsoft so far only lost money big time.
* Sony talks about getting back the money they have invested into the PS3 (dev, prod) within 5 years with a couple of years still to go after that.
* Microsoft talks about being positive from an operating profit point of view in 2008 with a product lifecycle close to 5 years.

You forgot to mention, Sony is currently 9 billion dollars in debt, while Microsoft has over 30 billion in cash on hand.

boots @ Aug 3rd 2006 12:08AM

ToxMax,

I thought all companies had a big pile of cash; and also, a big pile of debt. Microsoft must have a lot of debt too, just as Sony might have a big pile of cash (but admittedly not as big as Microsoft's).

Then again, who am I to talk anyway?

Oh, and it seems that Cage is becoming more productive on this site. Congrats, cage!