Topic: PS3 Estimated at $400

[Ymeegod]

That's kinda the rub--hype isn't going sell unless you're the market leader which clearly nintendo isn't.  

Even info that nintendo does leak out is usually misled.  Take for example the GBA 2--last year nintendo stated how the DS wasn't the sequel to the GBA and that a new GBA was coming next year--everyone assumed that Big N was coming with GBA2 but instead they're releasing the GBA micro .  Still no word on GBA2.

So far nintendo went from the GC lasting until 2008, to being the first to launch next generation in 2005, now to god only knows.  

[Ymeegod]

Forgot to add:

Someone stated how the launch of the PSP was unsuccessful because it didn't sold out?

A.) nintendo's DS didn't sellout during it's launch neither and that was 500k.
B.) Sony sold 620K during it's first week more
C.) Sony launch during spring which plays a major role had it made the holiday season it would have clearly sold out.

Sony was clearly gaining ground and fast but without the software the PSP numbers have declined much faster than the DS (going by the initial launch dates to now).

[IceCold]

Oh come on Ymee, some of your points are really flawed. Despite what you think, price is a HUGE factor.

Only Sony is myopic enough to believe that the PSP launch price (as well as its future horrendous game droughts) would be overshadowed by the PlayStation brandname.


"didn't do jack--same with the Gamecube---a more powerful system at $100 cheaper yet it sold DEAD last"

Many, many reasons for that. Because it was cheaper, it was perceived by the ignorant public that it was a lot less powerful than the PS2 or Xbox. Nintendo did close to NOTHING to prove that wrong, so there was always that stigma. On the opposite side, MS went all out to assure the public that the 'Box was the most powerful out there, and they succeeded in just that. Next, the PS2 came out a long, long time before the GCN. It had the benefit of developers jumping on the bandwagon for a fair bit of time to develop many games before the Gamecube was even out. They did have a drought, but it really didn't matter at that point. Then the "killer apps" came and it was over. From then on, the 'Station's userbase, software library, and 3rd partry support grew and grew and grew. Had they been released at the same time and if Nintendo had done some things differently (they couldn't afford to have the drought that Sony did), the Cube would be on even footing with the PS2.

"yeah killzone 2 was a video but imagine if that was actual gameplay--I wouldn't think twice about dropping a mere $400 bones. "

I'm really sorry, but in this planet we call Earth, some of us don't have $460 US to hand out to play a single game that, even if the graphics turn out to be like that, it's gameplay is in doubt to say the least. You wouldn't think twice? Wow, you should really thank your lucky stars; not many people can afford that luxury. A "mere" 400 bucks eh?

"everyone assumed that Big N was coming with GBA2 but instead they're releasing the GBA micro . Still no word on GBA2."

I don't WANT a GBA2; the DS is perfectly fine. And what a stupid, moronic, asinine decision that would have been to release the GBA2 so close to the DS's launch. Why on earth did you think Nintendo would do that. It's still a handheld, and it needs as much work on it as the DS does. Obviously Nintendo wouldn't have been able to handle it, seeing how pre-occupied they are with the DS. And what would the people who bought the DS for $200 say?

Also, those sales numbers are wrong, if I can remember correctly, the DS most definitely DID sell out its first shipment. The "usual people" bought the PSP at launch, but then after that the sales plummeted, due in large part to price. And you say that the PSP was gaining ground fast?? Launch games like that only take a system so far...it didn't have ANY major titles coming and at a price so high, it was inevitable that the sales would go down. Only a few people pay that kind of money for a handheld system. Clearly, a price so high can only take you so far; don't tell me that the PSP isn't suffering by having a price that is ridiculous.

So yea, price is IMMENSELY important to the overall success of a system, but other factors can help overcome it (as shown in the PS2 case)    

[Ymeegod]

Nintendo was supposed to ship 500K units--anyone working at the retail stores will tell you that nintendo didn't meet it's quota.  My bestbuy only recieved 6 units when it was supposed to have 12 just to cover the pre-orders.   Of course two weeks later another shipment was in but 2 of lose were canceled by then.  

And if you don't have $460 then wait?  How hard is that to figure out?  Wait one year or two and the price will drop to $200 or so.   I didn't spend $300 on the orginal PS2 but once it dropped to $200 I grabbed it up along with a bunch of $20 greatest hits.  I should have waited on the GC (spent $240 with a two year warranty), since it dropped rather quickly.  

[IceCold]

"Nintendo was supposed to ship 500K units--anyone working at the retail stores will tell you that nintendo didn't meet it's quota. My bestbuy only recieved 6 units when it was supposed to have 12 just to cover the pre-orders"

Well, that doesn't mean that it didn't sell.........

It just means that there was a huge demand and Nintendo couldn't keep up (12 preorders and only received 6)

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nintendo's DS didn't sellout during it's launch neither and that was 500k.

You had made it sound in the other post that Nintendo didn't SELL the 500k  

[Zach]

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Originally posted by: Ymeegod
That's kinda the rub--hype isn't going sell unless you're the market leader which clearly nintendo isn't.  

Even info that nintendo does leak out is usually misled.  Take for example the GBA 2--last year nintendo stated how the DS wasn't the sequel to the GBA and that a new GBA was coming next year--everyone assumed that Big N was coming with GBA2 but instead they're releasing the GBA micro .  Still no word on GBA2.

So far nintendo went from the GC lasting until 2008, to being the first to launch next generation in 2005, now to god only knows.

I think you missed my point Ymeegod, you said that you didn't understand why people were so excited when there was so little information released on the rev.  I think that just the fact that we know so little is the reason we are so excited, because:
1) that means that there is something neat that they are hiding from us
2) It is a lot of fun to speculate what that may be.

I never said in my post that I though Nintendo was trying to use hype to try to sell the rev, but all of this secrecy is causing a lot of hype among the nintendo fans at least, and that cant hurt.

Also, you can't blame Nintendo for the GC not lasting untill 2008 like they originally said.  With MS and Sony releasing their systems so soon, it would be suicide for Nintendo to wait that long to release the rev.  

Edit: Gramatical (sp?) errors

[nickmitch]

Ninentdo releasing GBA2 would be bad for 2 reasons:
1) Nintendo has to split its focus between closing off the cube, keeping up DS sales, online DS, and the Rev. Anymore to focus on would be too much.
2) People would start to ignore the DS or not buy thr GBA2 because of the DS.
Even there's still the whole 3rd pillar argument.

Nintendo has made many mistakes but I think that it's up to us as fans to beleive in them and trust that they know what they are doing.

[Spak-Spang]

Actually Nintendo saying the Gamecube should last till 2008 should probably tell you that this new generation of systems is coming too soon.

Really we could have easily lasted another 2-3 years with this current generation hardware and not lost any creativity or playability in games.

I really hate high defination skins and flesh textures for the new consoles.  Characters all look like DOOM 3 which I feel has some horrible, horrible character design and models.  Everything looks plastic...and has little imagination in it.

If the next generation systems would have waited till 2008 I can't even imagine not only the graphics difference, but what we might be able to with controllers and stuff.

[vudu]

There's a news article over at gamespot.com that's in total agreement with what Spak-Spang said.  Analyst sees growth, but not from next-gen consoles

Quote
"Unlike most industry observers, we do not believe that the industry has reached the end of a 'console cycle' that is winding down with slow or even negative growth. Rather, we believe that the current consoles (at least the PS2 and the GameCube) will continue to be the systems of choice for several more years, and expect a transition to the next-generation consoles to occur gradually. As a result, we expect sales of interactive entertainment software to continue to grow at approximately 10 percent per year through 2010."

It also touches on long (and ungodly expensive) devolvement times for next gen systems.

[Zach]

I agree completely, this next generation is completely early, but nintendo is in no position to change that, Sony and Microsoft want to rush ahead, and Nintendo can either go with them or be left in the dust.

[nickmitch]

If the next-gen would've waited the PS3 probably wouldn't be so damn expensive, but knowing Sony. . .

[Galford]

The reason this next generation is coming to an end so quickly is Sony.  Sony was talking about the PS3 back in 1999, I'm not kidding about that.  MS is launching early because it wants to get the jump on Sony.

I know what I said sounds weird, go look at the last six years and what Sony said and you will see what I mean.

[Ian Sane]

This next gen is hardly early at all.  The normal space between consoles is five years.  The Cube launched in 2001 and the Rev is launching in 2006.  If it's less than five years it will only be off by a few months.  The PS2 launched in 2000 and the PS3 will launch in 2006.  That's six years.  Sony is actually waiting longer than usual this time.  The PS2 will be Sony's flagship console longer than the PS1 was.  The only one jumping the gun is MS who launched the Xbox in 2001 but are launching the X360 a year earlier than usual in 2005.

[KDR_11k]

I really hate high defination skins and flesh textures for the new consoles. Characters all look like DOOM 3 which I feel has some horrible, horrible character design and models. Everything looks plastic...and has little imagination in it.

No, that's the result of bad specmaps and applying next gen technology to current gen hardware. Normalmaps are a major change and require a workflow different from what game or movie artists are used to.

MS is pushing this gen ahead, they want to see the XBox die early. They said they'd turn in a profit by 2007, which is the same year they're going to EOL the Xbox 1. They won't EOL it earlier because MS's way of EOLing something would sour customer relations and it would push people to the PS3 instead of the X360. By 2007 the initial rush for the X360 will be over as will the fierce battle around the PS3 launch. By then the one dominating will probably keep the position.

[couchmonkey]

Yeah, the only thing that's really early about this generation is Microsoft.  I think it was expecting Sony to launch the PS3 at the end of this year, so it wanted to catch up.  Then when it turned out Sony was content to wait an extra year to launch PS3, I guess MS thought it would take advantage of a possible head-start rather than waiting.

Of course, I agree that this generation could have gone on longer than previous ones, there really isn't as much room for technical improvement as there used to be.  I wish all three companies would give us an extra year or two on the current gen.

If Sony does come out at $400, will people buy it?  Of course some will, but it may wind up depending on features.  Price didn't make a difference this generation, but that may have been because PS2 and Xbox were seen as offering free DVD players (okay, Xbox didn't offer the DVD playback for free, but it was pretty cheap).  If Sony can convince people they need Blu-Ray, then it could get away with that pricing...assuming that pricing is correct in the first place.  Again, see PSP...everyone was predicting $300-$400 for that sucker.

[spadesman]

I am a lurker and wanted to try to steer this thread back on course. I worked at Best Buy for over 4 years from 1997-2002 in the Games dept. I sold countless PS1's, PS2's, GB Color, GBA, PS2's, GC's and Xbox's. I met people from many backgrounds and various levels of income. I share this because I think I understand the mindset of the average consumer.

The prices of the next-gen systems, I think, are going to be a huge problem. What people are forgetting about it the cost just to buy the unit. Remember, not everyone uses the internet, so sales tax has to be thrown into the equation, as most states have a local and state sales tax in the US.

$399.99 +$33 sales tax (@ 8.25%) = 432.99 just to walk out the door with the unit. I remember many times trying to sell a customer who wouldn't even buy a game because their kid only had $300 saved and the parents were covering sales tax on the PS2. Countless times you would sell a game but no memory card even after telling the customer the game was fairly useless without it. Now, in retail, the pressure to attach warranties and accessories in fierce. I predict will you will see many mainline stores doing forced bundles. At Best Buy, I knew for a fact many stores would lie about their stock based on what the customer was going to buy. If all you wanted was a system, "Sorry, out of stock." (I did not do this and this is one of the reason I left.) But if you were going to buy some accessories and maybe the warranty, they would just happen to be some in the back. If the demand for the PS3 is anything like the PS2, I see this happening all over the place. Remember, from my past experience, BB didn't make but maybe a dollar on the release of the PS2 so the only way to profit was off of accessories.

Now that we have the unit at $433, now what happens if they decide to buy a game? We have now jumped close to $500 for a system and one game @ $60. Controllers? Well if the PS2 launch is any indication, they will come out at $35. Some will have to correct me, but I don't think the PS3 needs a memory card so I will leave that out.

So if just to walk out the door for a game system and a game you have to spend about $500, that to me with scare anything all except the truly hardcore gamers. I also see forced bundles popping up everywhere. I just can't imagine BB or any other major retailer allowing someone to buy a $400 product with no margins on it.  

[vudu]

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BB didn't make but maybe a dollar on the release of the PS2 so the only way to profit was off of accessories.

Are margins on new consoles really that low?  

[nickmitch]

I thought that he was exagerating on the dollar thing, but was emphasizing on how low sales were because of BB only selling PS2's only to people who were willing to buy more stuff.

[Spak-Spang]

Spadesman:  I think you just proved the cost point exactly.

Lets also not forget if Blue-Ray movies are released they will cost more than normal DVDs which have gotten incredibly cheap.  Will you buy a movie for 25-30 dollars or 20 dollars or LESS!!!  

Looking at how Sony is treating the PSP they don't even really care about gaming anymore...they want to make money from their movies.  Sony could easily make this same mistake with the PS3.  Since Sony created a system that isn't dedicated to one product they must balance their releases and expensives to produce movies and games.  Movies are cheaper to produce and will provide a larger profit.  No wonder the PSP is focused on that.  The same will be true with the PS3.  

But back on subject.  The simple equation for next generation is this.


Xbox: $300 + $60 game + $50 (online service)= $410 to get into the system.  (You may get a year of online gaming free with purchase so maybe just $360.)

Sony:  $350+ $60 game + $15 (memory card) $410 to get a system.  Potentially less if the harddrive is included.  Potentially more because I under-estimated the price.)

Nintendo: $275 + $60 game = $335.00 Potentially less because games may be cheaper and hardware may be much cheaper as well.  

Given those prices I see Nintendo being the only system affordable to the mass market.  Xbox will be an expensive too for the gamer and have good penitration in the market, but the PS3 will have a much harder time, specially with the Xbox already on the market.

[nickmitch]

A 360 for $360? how drole.
But I expect Nintendo at $300. It's where they need to be and $50 for a game.

[Ian Sane]

Let's figure out how much it will cost Canadians to buy a PS3.

The conversion comes to 484.105.  You know they'll round up so let's say $485.  Canada has a federal sales tax of 7% and every province but Alberta (I think) has a provincial sales tax of about 7%.  So with tax it will cost $552.90.  OUCH.  Keep in mind that in Canada we don't think in terms of how much something costs in US funds.  $1 to us is $1, not 85 cents US so the price for us will be higher.  Counting accessories like a memory card and a game (which might be $60) and you can quite easily go over $700.  That's getting pretty damn expensive.

In comparison the Rev would probably be around $380 assuming a $275 US price plus tax.

[spadesman]

Quote
Originally posted by: vudu

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BB didn't make but maybe a dollar on the release of the PS2 so the only way to profit was off of accessories.

Are margins on new consoles really that low?

I might have misspoken. I was thinking about the employee discount price rather than actual cost. At BB, employee discount was cost + 5%. I remember employee discount on most systems being something like 50 cents off, usually no more then a dollar. I am going to call a former co-worker and see if he remembered the exact pricing. If that was the case though, BB would only be making about $14-15/per PS2 @ $300, or less then 5% margin per console. I am fairly certain that retail stores don't really profit on the hardware, but software and accessories. Adding the cost to deliver the goods to the stores, and you are looking at very razor thin margins if anything. I will correct my original post if I am wrong on the number. Thanks for the question.

[TMW]

Um...really, I can't see Nintendo selling the Rev for any more than $200.  Price is a very big issue, and if anybody can pull it off and still make a profit, it would be Ninty.  

[nickmitch]

But you need to remeber how price effected image this gen. Besides it may sell more consoles and produce an even greater profit, but it'll definately make for a better image.

[Galford]

Ah, I remember almost buying a PS2 near launch and finding out that it would cost me 350.00 + tax b/c the store I was at only sold PS3 bundles.  Needless to say I didn't buy it.

I still stand by my original comments.  Sony has always looked at the Playstation as just another electronic gadget.  If you read EGM back in the mid 90's, there were a couple of articles about Sony's plans for the PSX.  Sony original plans were PS2 by 98/99 and PS3 post 2001.  Those plans never panned out, but it shows Sony's mindset about videogames.

I just can't shake the feeling that the PS2 will die an early death b/c Sony finished the PS3 and are now moving on.  Granted it is five years after the PS2, but still...