Author Topic: Blue Ray and the Cost of a PS3 (Read 11111 times)

jasonditz · « **on:** January 21, 2006, 08:16:50 AM »

From Forbes:

Even the cheapest new Blu-Ray DVD players will retail for about $1,000. David Carey, president of electronics-component specialist firm Portelligent

Can that possibly be true? Who in the hell is going to shell out a grand for a Blu-Ray player? What's the target market?

Moreover, since the PS3 is going to be one of the first Blu-Ray players out there, will it really cost half of any other Blu-Ray player and have all the extra high end hardware on top of it?

Sony's only got a little under $3 billion in free cash, how much of that's going to be blown on the launch? Are they going to have to launch this thing as a $500+ console just so they don't have to go further into debt to get it to market?

kirby_killer_dedede · « **Reply #1 on:** January 21, 2006, 08:39:18 AM »

That's insane! The PS3's a Blu-Ray player and then some. Even if they sell it for 500 dollars, they're taking at least a 300 dollar loss. Insane.

jasonditz · « **Reply #2 on:** January 21, 2006, 08:52:43 AM »

The numbers in that article just don't add up in a lot of ways... for example, if the Blu-Ray drive by itself costs $100... why on earth will the cheap Blu-Ray players costs $1,000? Are they insisting on 300% markups?

Bill Aurion · « **Reply #3 on:** January 21, 2006, 08:56:54 AM »

Perhaps to make up for the cost of research and development? I would assume once those costs are taken back they'll start to lower prices...

KDR_11k · « **Reply #4 on:** January 21, 2006, 09:43:22 AM »

I think someone should tell them that when you're selling a format and the userbase for potential content is tied to the instaled base of the hardware it may be wise not to demand outrageous prices for the hardware?

BlackNMild2k1 · « **Reply #5 on:** January 21, 2006, 10:06:10 AM »

DVD was the same way when it first came out.

Renny · « **Reply #6 on:** January 21, 2006, 11:22:01 AM »

DVD also had no real competition. Manufacturers had the early adopters in their pockets. If HD-DVD can come in at a cheaper price, that'll give them a big boost--and a kick to the BluRay camp's nuts--that they're going to need. No one can really afford to rape the consumer with excessive markup this time.

Arbok · « **Reply #7 on:** January 21, 2006, 02:56:49 PM »

"Even at a pricey $500, Sony will be taking a loss on each machine, just as it did with each earlier PlayStation model. The company will hope to make money selling software for the console down the line--the same strategy Microsoft and Nintendo have taken. "

Doesn't Nintendo make a profit on their systems sold?

"If each game is priced at $50, Microsoft might earn about $25 in profits per game, suggests Carey. If the average Xbox 360 owner buys four games, Microsoft will have recouped the estimated $100 loss."

$25 of profit for Microsoft per game? That seems very, very high unless that was only talking about first party titles. If it was a first party title, there is also the production cost of the game to factor in as well.

Maybe it's just me, but I got a very anti-Sony/pro-Microsoft vibe from the article as a whole.

stevey · « **Reply #8 on:** January 21, 2006, 04:31:24 PM »

I think ps3 may cost way over $500 looking at all the stuff that they say their adding but it sony and they can just be lieing about what in their system like the last 2 times.

and off topic, I just google blu ray and this was the first link I got. lol

nickmitch · « **Reply #9 on:** January 21, 2006, 04:43:04 PM »

Why are all of sony's formats supported by porn? It's quite perplexing.

UncleBob · « **Reply #10 on:** January 21, 2006, 07:02:47 PM »

All formats are supported by Porn. It's the way porn works. In fact, you can generally tell how well a new technology will catch on by how well the porn industry attaches to it.

For example, a major factor for DVDs catching on was because of the porn industry - they're cheap as heck to produce, the skip-to-scene feature works great for viewing a porn flick (or so I've heard), DVDs are much cheaper to ship (in plain, brown envelopes), much easiler to include "free" with magazines... Granted, a lot of these same reasons is why the general market picked up on DVDs so fast, but have no doubt, if it wern't for Porn, much like 900 Phone numbers, Pay-Per-View Television and even the VCR probably wouldn't have rushed into our lives so quickly. Heck, I believe the Porn Industry is pretty much credited with VHS winning out over Betamax.

http://www.usatoday.com/money/industries/technology/2004-03-09-onlineporn_x.htm

Epitaph · « **Reply #11 on:** January 21, 2006, 07:25:28 PM »

Im not sure if im right with this but I think the major reason for the cost is the power within the machine to run the HD video. If you look at the specifications to run HD video on your computer they sujest you have at least 1.8 ghz machine. Not sure one the ram and video capabilities but needless to say it takes alot of power to run HD video. They also have to offset the cost of making it in the first place so the early adopters usually cover those cost. Once those are out of the way then they drop the price.

KDR_11k · « **Reply #12 on:** January 21, 2006, 09:28:50 PM »

Decoding video is a bunch of vector operations, a worst case scenario for x86 compatible CPUs (and best case for the Cell). It's better to build a dedicated video decoder chip into these, that'll do the same amount of work with much less MHz.

BlkPaladin · « **Reply #13 on:** January 21, 2006, 10:52:41 PM »

Someone asked about if Nintendo is making money on their console. I would have to say by now they are. A year or two ago they had a bidder war to get another manufacture for the Gamecube and it cost them $99.00 per Gamecube at that time. (They were selling for $150 at the time.)

As for the DVD player they were expensive. I was a semi-early adopter and it cost me $350.00 for a striped down player that now costs $50.00, and at the time there was only about 20 titles avaible in my area.

BigJim · « **Reply #14 on:** January 22, 2006, 06:54:56 AM »

There's almost always a considerable difference between BOM (manufacturing cost) and retail. If you knew the markups on things from sports watches to even $40 DVD players, you'd crap yourself.

Consoles don't follow the same supply/demand rules as other electronics, as far as pricing goes... or else the 360 would have been something like $1000 itself due to the limited supply. It's already been mentioned that BRD drives will cost in the neighborhood of $100 to manufacture, so the drive wouldn't add much more cost than that to the final price if their goal is to break even or sell at a slight loss.

Their goal is specifically mass penetration through PS3. It's their trojan horse. So even if they sell it at break-even or a partial loss, the rewards of winning the HD format later will be huge. At worst, BRD is a game format like UMD.

Galford · « **Reply #15 on:** January 22, 2006, 08:10:02 PM »

It will be interesting to see what happens when people start hacking HDDVD and BRD drives? There is going to be a lot of power available to who ever can harness them.

For example, HD-DVD drives require at least a 128 Megabytes of RAM. Early DVD drives required something close too 2 Megabytes...

MysticGohan · « **Reply #16 on:** January 22, 2006, 08:27:14 PM »

Hmmm... We shall see who will win this Choatic yet unneccessary formatt war. Although I'd think sony would have to be more wary about this. Considering that they lost the last formatt war, ala Betamax vs. VHS
Can history repeat itself? Actually... Slightly, different situation but similair methods are being applied in a situation that rises once again! so yeah..!

KDR_11k · « **Reply #17 on:** January 22, 2006, 08:41:17 PM »

It will be interesting to see what happens when people start hacking HDDVD and BRD drives? There is going to be a lot of power available to who ever can harness them.

Why hack? Just plug 'em into your PC and get on with life.

jasonditz · « **Reply #18 on:** January 23, 2006, 05:27:24 AM »

Quote
Originally posted by: Epitaph
Im not sure if im right with this but I think the major reason for the cost is the power within the machine to run the HD video. If you look at the specifications to run HD video on your computer they sujest you have at least 1.8 ghz machine. Not sure one the ram and video capabilities but needless to say it takes alot of power to run HD video. They also have to offset the cost of making it in the first place so the early adopters usually cover those cost. Once those are out of the way then they drop the price.

Yeah, but Sony's managing to pack enough hardware into the PS3 that it's probably a factor of 10 at least more than what's required to decode HD video... and even the "worst case scenario" has them able to squeeze all that plus a lot of other game-specific hardware into a box with a Blu-Ray for $700 or so...

I can't imagine that the cost of the Blu-Ray drive ($100) plus the cost of the rest of the components is any more than $200-$250... charging $1,000 (particularly when a video game system is offering the same media playing capabilities and a lot more for probably half the price) is completely moronic.

Sir_Stabbalot · « **Reply #19 on:** January 23, 2006, 11:02:48 AM »

I heard that ninty is losing money now per unit of GCs sold. But also that the loss is so small its negated when the first game is purchased.

stevey · « **Reply #20 on:** January 23, 2006, 11:20:06 AM »

Quote
Originally posted by: Galford
It will be interesting to see what happens when people start hacking HDDVD and BRD drives? There is going to be a lot of power available to who ever can harness them.

For example, HD-DVD drives require at least a 128 Megabytes of RAM. Early DVD drives required something close too 2 Megabytes...

http://www.engadget.com/2005/09/02/blu-ray-players-to-punish-users-who-hack-their-gear/

kirby_killer_dedede · « **Reply #21 on:** January 23, 2006, 11:28:15 AM »

Stabbalot, I heard that once too, but you must know: Nintendo would never do anything without profit being involved.

Galford · « **Reply #22 on:** January 23, 2006, 11:32:19 AM »

What the article doesn't elaborate on, is both HD-DVD and Blu-ray have tcp/ip and http connections built into the standard. One "feature" being talked about is content being stored on disk and then having to pay for over the internet to enable.

Welcome to the New World Order...

PS - Edited post so it made sense.

Epitaph · « **Reply #23 on:** January 23, 2006, 01:36:57 PM »

Quote
Originally posted by: Galford
I haven't read that article yet, but I 'm not surprised. What the article doesn't elaborate, is both HD-DVD and Blu-ray have tcp/ip and http connections built into the standard. One "feature" being talked about is content being stored on disk and then having to pay for over the internet to enable.

Welcome to the New World Order...

Thats only true if people are willing to put up with it. If people think its gone too far they simply wont support it and things will change. You cant make profit without support.

wandering · « **Reply #24 on:** January 23, 2006, 10:02:26 PM »

But when high definition Star Wars and Lord of the Rings and Titanic are on the line, it's hard to see people taking a stand....

News:

Author Topic: Blue Ray and the Cost of a PS3 (Read 11111 times)