Yes, we know the PS3 is expensive, Sony (SNE) executives say. But don’t expect any price cuts until manufacturing costs come down.
That’s what Sony Computer Entertainment Europe boss David Reeves tells Eurogamer today.
Sony’s (SNE) PS3 cost a whopping $691 to build when it first came out, and it sold for a retail price of about $500. Nowadays with better manufacturing methods (and extra components that allowed older PS3 models to play PS2 games stripped out), Sony is able to build a PS3 for an estimated $449, still higher than the $400 retail price.
But for Sony, it’s all about profit, not sales, and no price cuts are coming until the manufacturing costs drop even more. (PS4 rumours circulating the Internet claim Sony’s next console will be designed for cheap manufacture from the ground up.)
Reeves: The plan wasn’t necessarily to hit sales, it was to hit a profit target..
I’m not saying there are going to be any price cuts at all in the short term or the medium term. I’m not saying we don’t need to do it – we are expensive. It is possible that as the cost [of manufacturing] comes down, we will be able to do it.
But we’re protecting ourselves with a very hard shell to get through the next one or two years of an economic situation. If you’re experienced, you know you have to go into that mode – it’s like being an armadillo. You have to be hard, and then you will come out when the sun comes out.
Eurogamer: Will you cut the price of PS3 this year?
David Reeves: As the cost of manufacturing comes down, we will look at it, as we’ve looked at it in the past. I’m not going to say we’re going to do anything short term or anything long term on the price. At the moment, we have a value-added strategy.
Reeves also makes a subtle dig at Sony’s Kaz Hirai (and then immediately backpedals, sort of), who recently boasted the Sony remains “the official leader” in gaming.
Eurogamer: Sony Computer Entertainment boss Kaz Hirai was recently quoted as saying the Xbox 360 “lacks longevity”. Do you agree?
David Reeves: I’m not going to comment on that.
I simply don’t know what their plans are. I’m not going to be as arrogant as to comment on either Nintendo or Xbox 360.
Eurogamer: Do you think what Kaz Hirai said was arrogant?
David Reeves: I don’t think so. He was probably misquoted, because I don’t think Kaz would say that
Reeves also says: “The last few weeks have shown we are clearly number two in the market.” Have Sony’s slow-motion price cuts in effect since New Year’s been paying off?
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