Print 55 comment(s) - last by Hemipower.. on Sep 25 at 5:07 AM

Sony's entry-level PS3 gets a price cut before launch

Console gamers in Japan were able to breathe a slight sigh of relief today when it was announced that Sony would trim the price of the basic 20GB PlayStation 3 console to 49,980 yen or $430 USD (down from $499 USD). The price cut is a direct response to the cries from the buying public over the high price of entry for the PS3 in comparison to its competitors. It was also announced that the base system would get HDMI output.

Even with the price reduction, the base PS3 is still priced well above its competition. It was announced two weeks ago that Microsoft would introduce the XBOX 360 Core System for the Japanese market at around $255 USD. Last Thursday, Nintendo announced a price tag of $212 USD for its Wii in Japan.

Sony's Ken Kutaragi remarked to reporters that "The Japanese users and media would not stop saying a price tag of over 60,000 yen, including tax, was too expensive." One must also remember that Kutaragi was also quoted as saying back in May that the $499/$599 price points were "probably too cheap."

It should be noted that while the price cut affects the 20GB PS3 model, there is no word on if the price will also fall on the higher spec'd PS3 with its 60GB hard drive, WiFi, and MemoryStick/SD/CompactFlash reader. There is also no word as to whether this price cut will extend to PS3s destined for US shores.

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Stick to your Guns
By swampwalk on 9/22/2006 2:12:17 AM , Rating: 2
It is definately unwise for Sony to engage in a price war before the system is even released.

Despite all of the PS3's problems over the course of the last year, the one thing that Sony has stuck with is that the PS3 = Quality. The idea that the PS3 offered superior technology justified it's higher price point and at least gave consumers the perception that this was the truth.

Cutting prices so close to launch undermines Sony's position. Given the shortage of units available at launch, good business would dictate a higher price point. It's a given that the units will sell out immediately regardless of price because of early adopters.

This move hurts Sony twofold; It increases the hit they take on each console sold, and sends out the message that the console might not be as superior as Sony claimed previously.

Also, why just price cut the budget systems?

RE: Stick to your Guns
By mushi799 on 9/22/2006 2:15:08 AM , Rating: 2
lol, sony gives a pricecut and some ppl will still criticize it. What can sony do for to please ppl nowadays?

"The price is too high", sony does a price then

its "undermines Sony's position", "good business would dictate a higher price point."

RE: Stick to your Guns
By swampwalk on 9/22/2006 2:34:22 AM , Rating: 2
It would be great if Sony took care of their investors.

You cut prices to entice people to purchase something they otherwise might not. All 100,000 units in Japan are going to sell out rather quickly regardless of price. Why would you want to make less money?

It would be a different story if more units were avaiable and they cut prices in the United States (where people are more prone to complain about the price) or Europe. But this is not the case.

Sony being profitable is important so a) They don't screw us over later on the price of games/accessories/online content to recoup the losses they take on the console. And b) so they can actually compete with the 360 in the US and Europe so that prices of all consoles and games become lower for the consumer.

RE: Stick to your Guns
By GhandiInstinct on 9/22/06, Rating: -1
RE: Stick to your Guns
By GhandiInstinct on 9/22/06, Rating: -1
RE: Stick to your Guns
By tuteja1986 on 9/22/2006 3:35:55 AM , Rating: 2
Actually i may actually buy the 20GB model , i couldn't care less about non intergrated wifi and it now has a HDMI slot. Now i just need my pal to camp out 1 whole day next the camera shop in japan that will have some PS3 :).

$430 + $40 shipping fee = better than $990AUD

RE: Stick to your Guns
By Strunf on 9/22/2006 6:45:48 AM , Rating: 2
"Speaking of ridiculously overpriced accessories, the Wii's controller will cost more than the games..."
Overpriced? the WII controller is far more sophisticated than any other controller and it will around 60$ heck even at that price I don’t think they make any profit with it... and some games will cost 60$ too.

RE: Stick to your Guns
By Vertigo101 on 9/22/2006 8:57:37 AM , Rating: 3
Don't kid yourself: It doesn't cost Nintendo $10 to make those controllers.

RE: Stick to your Guns
By Strunf on 9/22/2006 10:00:36 AM , Rating: 2
Doubt of it...

RE: Stick to your Guns
By tuteja1986 on 9/22/2006 10:20:12 AM , Rating: 2
I can tell you from an engineering point of view... that nintendo stands to make money on each console sold from day one. They will rake in money from the overpriced controller to the games. Imagine who many copies of Zelda will sell on virtual console and all they had to do was a make a emulator that will play these game. Nintendo isn't updating any virtual console games stuff like Microsoft made its partners add World Ranking , Online Competent , Updated graphic and sound before they could launch release it on Xbox live arcade.

Nintendo will make millions while Sony and Microsoft will loose millions. In fact the real winner is Nintendo and what i am predicting is that Nintendo Wii will be the most profitable console in gaming history.

In late 2004 to mid 2005 i thought Nintendo was in a ditch and was about to surffer the same fate as saga did.

RE: Stick to your Guns
By Strunf on 9/22/2006 2:51:31 PM , Rating: 2
Sure the goal of Nintendo is to make money but they will make it like everyone else in games, the console is already rather cheap, the controller isn’t that expensive at all when you take into account that for 60$ you have the nipchunk thing and a wireless remote, by comparison the WIRED Xbox 360 controller costs $40 and it has nothing new at all...

RE: Stick to your Guns
By Vertigo101 on 9/22/2006 3:40:55 PM , Rating: 1
You apparently don't understand that it costs MS next to nothing to make those controllers.

RE: Stick to your Guns
By rushfan2006 on 9/22/06, Rating: -1
RE: Stick to your Guns
By Fenixgoon on 9/22/2006 10:05:36 AM , Rating: 2
no company takes a loss on products? whatare you smoking?

all consoles are currently SOLD AT A LOSS. Sony, MS, and Nintendo (apparently they will profit from the Revolution) make money on accesories and games (due to licensing). Otherwise, the PS3 would cost A LOT more if Sony wanted to profit off of the initial sale of the PS3 console (same goes for MS and 360).

RE: Stick to your Guns
By StevoLincolnite on 9/22/2006 11:07:35 AM , Rating: 3
Allright, Nintendo has allways had the more "Advanced" Controllers so to speak. Or you could say the wierder looking ones. As for losses on consoles. Microsoft lost billions of dollars on their console. Yet broke even with the piece of the PIE that they sold through games. The PS2 lost money during its release. (They make money off it now though).
And the Nintendo Wii? Its using older/cheaper technology in comparison to the Xbox 360 and PS3, so they MAY make a loss on each console but it wouldnt be anything significant.
And the Wii Controller. Your paying for 2 controls for 60 bucks. And the PS2 control is allmost the same as the PS1 control. Guess what? they sold them at double the price for a long time there. Alot of people just used their controls from the PS1 on their PS2.
My Honest Opinion on the Console wars? This time, Nintendo will be on top, IF they can get some decent games. (They improved upon that to some extent on the game cube).
Microsoft will probably end up being the middle man once again. And Sony's exhorbant prices is going to ruin them just like sega. Even alot of game developers are bitching about sony. It seems everyone is bitching about sony! Oh well. Just my 2 cents.

RE: Stick to your Guns
By Strunf on 9/22/2006 10:15:09 AM , Rating: 2
Dude... first there's plenty of companies selling products at loss; secondly the building price is FAR from having the greatest share on the selling price (on this kind of market).

Don’t give a crap about the MS dude you have spoken with it's common knowledge MS and SONY and probably even Nintend didn’t get profits from the console's sale.

Even if costs $20-$25 to make what makes you think they will get ANY benefit by selling it at 60$ ?... Also 60$ is the price of the remote unit AND the nipchunck (?) thing.
Maybe they will get some benefit out of it but if they were selling the 2 units for 25$ like some of you seem to have wished sure as hell they wouldn’t have any profit.

RE: Stick to your Guns
By GhandiInstinct on 9/22/06, Rating: -1
RE: Stick to your Guns
By randomlinh on 9/22/2006 6:59:32 AM , Rating: 2
and... how much is the new ps3 controller? an xbox360 controller is $50.

not that I'm saying it's not expesnive, but it's not like the wii is a complete rip off (well, for now, we'll see how it plays on launch day).

And yeah, they should slash prices. They're already losing gobs of money anyway. It'll be an expensive lesson learned for them to fix for the next iteration. And if they try and recoup w/ jacking up costs for games... they'll just get even more backlash.

RE: Stick to your Guns
By djcameron on 9/22/2006 10:35:57 AM , Rating: 2
We the consumer have (stupidly) supported such price gouging. Take iPod accessories, for example... They charge 20 USD for a stupid rubber iPod cover, that costs 5 cents to make, and "we" gladly pay it.

RE: Stick to your Guns
By Armorize on 9/22/2006 4:31:10 AM , Rating: 2
that would be nice but its not gonna happen were still gonna pay 50-70 for games to make up for the differance, so one way or another americans are pretty much screwed and will have to shell out some major cash to get the console and games. I think the initial release into the us will get the high prices and when the next shipment comes in we might get a price cut.

RE: Stick to your Guns
By tophat on 9/22/2006 12:28:29 PM , Rating: 2
I agree that Sony is a bit premature in making the price cuts. I suspect that with the limited number of units available at launch, the units would still be able to command the $499 retail. The demand is still going to be there at launch and it, in my opinion, would only make sense to drop the price after the initial inventory (available units at launch) is depleted.

Either way, it is still good news for the consumers. Whether or not it would make much difference in market penetration is left to be said.

RE: Stick to your Guns
By Sunday Ironfoot on 9/22/2006 8:57:24 AM , Rating: 2
lol, sony gives a pricecut and some ppl will still criticize it. What can sony do for to please ppl nowadays?

He was just giving his opinion from a business point of few. I'm sure from a consumer perspective he's quite happy about the price cut, less money he needs to spend if he wants one after all.

RE: Stick to your Guns
By xsilver on 9/22/2006 8:57:37 AM , Rating: 2
Yes, I think that the price has gone in the wrong direction.
Because the initial units will sell so fast they should jack UP the price.. They can then reduce it when supply becomes more stable and the initial fanboi's have all bought there systems and need more of the general public to hop on

RE: Stick to your Guns
By leousb on 9/22/06, Rating: 0
RE: Stick to your Guns
By encryptkeeper on 9/22/2006 11:00:10 AM , Rating: 3
Sony really will lose big this generation if they only concentrate on things like graphics and having the 'best' technology. If you look at the cpu core speed numbers from the last generation (or the current generation rather) the PS2 clocked at under 300 MHz. But it was UNDOUBTEDLY the winner of the generation. Even with lots of customers complaining about dead PS2's they held on to be undisputed champion of the 2001-2006 game console era. Why? The huge library of incredible games. Most weren't successful because they looked good, (GTA 3 is a prime example) but they were just, well, good games. They have to balance good looking games and make them fun as well. If not they will fall into what happened to Sega, where the technology is ahead of it's time and ruins their focus on quality games.

The bad thing is, Sony's reputation for quality products has been seriously tarnished lately (PSP movies are a great example)

Can't compare to core xbox
By Hemipower on 9/22/2006 3:49:37 AM , Rating: 1
"Even with the price reduction, the base PS3 is still priced well above its competition."

The base Ps3 now with hdmi, still offers more than the premium xbox for only 30 dollars more. Im not saying which system is the best as I currently own both the core and premium xboxs, but the the "base" ps3 still has bluray, hdmi, 1080p support.

If you ask me, i rather have the base for 430 than an extra 40gb, wifi, and media reader all for 170 on top.

RE: Can't compare to core xbox
By RedStar on 9/22/2006 4:08:43 AM , Rating: 2
xbox 360 also gets 1080p in a free software upgrade :)

hdmi ..pfft :) won't need that for 5 years according to the movie deal.

RE: Can't compare to core xbox
By robber98 on 9/22/2006 2:00:11 PM , Rating: 2
I said that before and I will say that again...

1080P through analog cable is a joke. With so many electronic components cramp into a small box, video signal will be degraded easily during DAC process. Without HDMI (digital connection), what's the point having a HD video player?

RE: Can't compare to core xbox
By ViperROhb34 on 9/24/2006 12:25:50 PM , Rating: 2
1st off all its clear that Bluray degrades if its not on HDMI.. HDMI is mostly about DRM ..

Its not clear what software upgrades and rights Microsoft will have.. Im sure they will patch the Xbox 360 because they wouldn't WASTE time upgrading to 1080p.. and show a picture with quality just barely above regular DVD..

Only Sony would do that.. just like how some got screwed buying Bluray recorders for their pcs and come to find out they can't even play Bluray movies on it !

RE: Can't compare to core xbox
By HueyD on 9/22/2006 8:48:39 AM , Rating: 3
Article from HardOCP. Price cut is for Japan only!!!

Quote "Sony is to cut the Japanese cost of its forthcoming PlayStation 3 console by 20%, the consumer electronics giant announced in Tokyo on Friday. The price cut is aimed at boosting the launch of the machine and making it more competitive with the Xbox 360. The price for the North American and European launch will stay the same."

RE: Can't compare to core xbox
By ViperROhb34 on 9/24/2006 12:22:13 PM , Rating: 2
You said the base PS3 offers more then the Xbox 360 for only 30 dollars more?

Are you smoking crack ? Read the article(s) .. The base PS3 is 430 US dollars in JAPAN.. The Base Xbox 360 is just over 200 US dollars in JAPAN... thats 200 US dollars TWO HUNDRED !! And if you read the article about the Xbox.. they are also selling the base Xbox360 in Japan with 2 games for free !

RE: Can't compare to core xbox
By Hemipower on 9/25/2006 5:07:39 AM , Rating: 1
No i don't smoke crack!

Again you are comparing the core xbox with the core ps3. Thats not even close! I have the core system and i got it for 200 used, and I still wish i would have just bought the premium ( which i also have). If you compare the 400 xbox premium to the 430 in japan ps3, the difference is 30 dollars and you get more with ps3. Now quality and available games etc that everyone wants to fight about is up to you. But from a hardware only stand point you'll get more with the ps3. Why not get the ps3 core from japan for 430 plus 20 for shipping (they are still region free for games right?) and theres your price cut!

As far as hdmi, I have seen people pay over 300 dollar of a premium just to have HDMI on a high end av reciever. So for sony to include this in the core and still give them a price cut is pretty significant.

It a good price, but will you be able to find one?
By MykC on 9/22/2006 9:43:27 AM , Rating: 2
I'm assuming since there was no mention of a price drop on american shores that the price for the rest of the world will still be $500.

In an interview with Gamespot it was stated that the PS3 distribution would be 20% core systems, 80% premium system. This means the japenese will only get 20 000 units at the $430 price at launch. So... will I be able to find one?

To honest, I wouldn't be surprised if this was essentially a on paper price cut, meaning that they cut the price and make very few buyable units avaiable at this price but still get the news/buzz benefits for cutting the price without the kick in the teeth ($ in losses per console).

Assuming that the price cut is made global this would mean that at $430 I could get a step up in graphics, a blu-ray player with HDMI (however, I do believe that I still only get composite cables out of the box). But, to be fair the XBOX 360 still has a $30.00 edge and if you live in Canada (and europe I think) you also get 6 months of xbox live, $25.00 worth market place points, a headset and Project Gotham Racing 3 (its a good game but with Forza 2 coming out I can see why they are giving it away).

Assuming all software being equal, it hard to tell what hardware I would immediately go for in Japan. We have the Wii at $212, XBOX 360 core at $250 (with two games, I believe?), XBOX 360 Premium $400, PS3 Core at $430 and finally PS3 Premium $600.

By rklaver on 9/22/2006 11:33:07 AM , Rating: 2
Xbox may have a $30 edge, but that's before the purchase of the external HD-DVD.

Might be worth it for the blue ray player, but unfortunately Halo 3 will drive my next console purchase. Unless there will be a PC version then it's fair game :-)

By ViperROhb34 on 9/24/2006 1:05:28 PM , Rating: 2
Read the article(s) .. The base PS3 is 430 US dollars in JAPAN only.. because MS lowered the Base Xbox360 to just over 200 US dollars in JAPAN only... thats a difference of 200 US dollars.. REPEAT TWO HUNDRED !! And if you read the article about the Xbox.. they are also selling the base Xbox360 in Japan with 2 games for free !

By Clauzii on 9/25/2006 4:08:10 AM , Rating: 2
What will those two games be? Something otherwise not saleable?

Also includes HDMI
By Shooks on 9/22/2006 2:03:06 AM , Rating: 1
The cheaper model will also include HDMI, I think Ken casually slipped that in during the Q&A after the keynote

RE: Also includes HDMI
By Mudvillager on 9/22/2006 4:58:37 AM , Rating: 2
Good news if it's true. Now if only a WLAN-adapter was integrated too...

RE: Also includes HDMI
By Vertigo101 on 9/22/2006 9:36:56 AM , Rating: 2
And heck, wouldn't it be easier to just include the same size hdd in both models too?

And wouldn't it cut down on manufacturing costs if they didn't have to differentiate betweek two SKU's at all?


By Gelde3001 on 9/23/2006 11:24:42 AM , Rating: 2
How exacly can there be a price cut on an item not yet on sale ?.

This is simply marketing to show you all how ignorant you really are as a nice take it up the a$$ from sony. Suddenly a tiny proportion of proposed not launched or purchasable items in one part of the world is cheaper than it might have been in the first place assuming they really launched at 500/600 ?.

Wake up - grow up - sell out.....all sony wants is the recommend one of the former - or both.

Marketing is wonderfull isnt it - this is a game of chicken to try to FORCE microsoft to lower the 360 price that bit early - which they fully intend to do in another month or so anyway, but now this starts a debate on what the hell sony is thinking whilst keeping people away from shops for another couple of weeks while the soap opera you all buy into carries on.

Idiots rule - and idiots follow......remember that when the salesperson tells you how much better it is to buy nothing for to eskimos indeed.

You know its wrong when someone agrees with should shut up and put up in 2 months.....end game. If the POS3 is genuinly good it will do well - if it (as specs and programmers suggest) not as good as the 360 currently then ce la vie - it will still do reasonably. If however the quality control isnt close to being adequate - which it wont be for certain on at least the initial couple million units - then more fool who buys this shite.

Id rather buy my wife and kids something nice rather than waste this level of time and money on a toy that will be useless within 6 months without periodic monetary additon.

SOD IT ALL !>.....

By Clauzii on 9/25/2006 4:13:17 AM , Rating: 2
Microsoft lowered the price first, so I can only see SONY as following that track.

This time...
By Clauzii on 9/22/2006 4:11:41 AM , Rating: 3
... SONY listened. Way to go :)
I'm still in :)

By brshoemak on 9/22/2006 7:42:26 AM , Rating: 3
the one thing that Sony has stuck with is that the PS3 = Quality

why start now?

One problem?
By MonkeyPaw on 9/22/2006 10:50:17 AM , Rating: 2
Didn't Sony say that they were going to ship mostly the high-end consoles early on? If so, this reduced price announcement is just smoke and mirrors. It makes them look more competative this holiday season, even when they're not. I guess eventually it will be nice when the consoles are more available, and I do commend Sony on adding HDMI to both models (as originally planned). Now if only HDMI TVs and Cables weren't so expensive.

RE: One problem?
By Hemipower on 9/22/2006 11:25:30 AM , Rating: 1
HDMI cables aren't expensive. Buying monster brand cables is a waste of money. I have a samsung hl-s6187w dlp tv with 1080p and I have tried 200 hdmi vs monoprice 10 dollar hdmi cable and there is no difference. If its digital like dvi, hdmi etc. than all the cables will perform the same.

Oh and dlp are dropping like flies. You could get my tv from BB for 2400 was 3400. And the 50" for 1800. amazon also has these with great price free shipping and no tax :). Just make sure you get the 87w model as thats the one with 1080p.

Not a big deal
By Loc13 on 9/22/2006 9:16:19 AM , Rating: 2
According to Sony, most of the launch systems will be Premium models anyway, so cutting the prices on the core systems doesn't really hurt them too much. But in the long term, who knows. I for one would now consider the core model if the price is $430 in the US. We'll see :)

By Hakuryu on 9/22/2006 9:45:35 AM , Rating: 2
Anyone ever see stats relating to this?

I see Sony selling out it's initial batches to the hardcore gamers, but will parents shell out even the reduced price cost when the alternatives are much cheaper?

Come christmas time, figuring a system and 2 games to be purchased for children, will parents shell out around $600 for the PS3? I'm leaning toward a Wii myself, simply because it's something different, and I already have a PC. The cost still seems too steep for me, with the benefit being able to play a couple PS3 only games.

Not sure what to think
By 05SilverGT on 9/22/2006 9:56:12 AM , Rating: 2
Since this looks to be a Japan only price drop I'm not getting too excited. Plus I was looking at the higher end model. After seeing what is being shown at TGS there really isn't much to get excited about other then MGS4 for PS3. DMC4 looks good but I have this feeling that it will also be on 360 at some point. With the announcement of native 1080P support on the 360 it's getting harder and harder for me to feel the need to own all three consoles this generation.

Still too high for me
By RunLikeHell on 9/22/2006 4:08:22 PM , Rating: 2
still too high in price for me.

By michal1980 on 9/22/06, Rating: -1
RE: lol
By h0kiez on 9/22/2006 8:52:19 AM , Rating: 2
This is plain dumb. The console WAS too expensive and this is a great idea. But the timing is retarded. Regardless of what anyone says about the console, they're going to sell out quantities for this entire year worldwide...probably 1-2 million units. If I were a stockholder (not nearly that stupid), I'd want an extra $80 x 2,000,000. $160 million in lost revenue right there.

RE: lol
By peternelson on 9/22/2006 9:32:14 AM , Rating: 2
EXCEPT that they are only discounting the low end console.

According to figures, they plan to launch with only 20% of the shipping machines being low end, with 80% of sales being highend. Since supplies in stores will be limited, that ratio is fixed. Even if consumers now want the cheap one, stocks will run dry, leaving them only the option of getting an expensive one.

Therefore your calculation $80 lost in price reduction times 2m units=$160m is incorrect. They only lose that $80 on the 20% of units that are cheaper. Additionally that 20% is in VOLUME of units and as they are priced different, it is less than the proportionate 20% in revenue.

So for relatively little "loss" they have repositioned the perception of console in the market as more affordable/value.

Also don't forget with the highend one, we may see some BUNDLES of games with it making the games price discounted from the alleged $60.

With other short supply consoles, stores have refused to sell consoles without games, thus they used their stock in "bundle" deals say with 2 or 3 games.

Considering it contains a bluray player and HDMI now, how cheap can you reasonably expect it to be?

By GhandiInstinct on 9/22/06, Rating: -1
By xbdestroya on 9/22/2006 10:46:41 AM , Rating: 2
Uh... yeah but that was obviosly staged (the question).

Kutaragi wouldn't make an *actual* on the fly decision like that; that's just stupid. I mean this thing is going into production as we speak, so obviously the HDMI inclusion was something they decided on a while ago. The Q&A session was just his way of letting the world know.

"Intel is investing heavily (think gazillions of dollars and bazillions of engineering man hours) in resources to create an Intel host controllers spec in order to speed time to market of the USB 3.0 technology." -- Intel blogger Nick Knupffer
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