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PS4 is on track to become a more profitable venture than the legendary PS2

The PlayStation 4 has only been on the market for roughly six months, but the gaming console is already profitable for Sony. The PS4, which has been winning the sales battle with Microsoft’s Xbox One since the beginning of the year, is “already contributing profit on a hardware unit basis” according to Sony Corporation President and CEO Kaz Hirai.
 
This is definitely great news for Sony as it lost money on the previous generation PS3 for over three years. Sony was determined not to make the same mistake with the PS4, with Sony Computer Entertainment CEO Andrew House stating in August 2013, “We will not generate anything like the losses we did for the PlayStation 3.”

 
In other PS4 news, Sony reported that it has sold over 7 million of the consoles (as of April 7) and that the console is now available in 72 countries. Sony also noted that half of registered PS4 users have signed up to use its PlayStation Plus subscription service.

Sources: GameSpot, Sony [PDF]



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Just goes to show
By FITCamaro on 5/23/2014 10:18:22 AM , Rating: 3
The difference between using completely custom hardware and slightly custom COTS hardware. That said, now I wish they'd pushed the envelope a little more in the hardware department to put out even faster hardware. But the crappy state of the economy pushed that decision. Neither Microsoft, nor Sony, wanted to gamble hundreds of millions or billions on developing custom hardware on the hope people would buy it. Those days are gone. And gaming is probably better for it since with similar hardware, its easier to make cross platform titles and ports.




RE: Just goes to show
By karimtemple on 5/23/2014 10:28:46 AM , Rating: 2
I also wish they'd pushed the envelope a little more.

But this is really cool news too. I really couldn't care less whether Sony or any other unimpressive company lives or dies, but major players making money off of the hardware alone (!) is great news for gaming itself.


RE: Just goes to show
By FITCamaro on 5/23/2014 10:38:40 AM , Rating: 1
Yeah there will be whiners but what it means is that the company stays healthier and we have potentially better stuff down the road. A company that struggles just to put the hardware out there because of all the money they're losing isn't a healthy one. And generally means more bad products down the line. One could make the argument that what happened with the PS3s costs is why we have a less powerful PS4 than we'd maybe like. Same goes for the 360/XB1.


RE: Just goes to show
By Reclaimer77 on 5/23/2014 10:45:00 AM , Rating: 2
I think they pushed the envelope as far as their $400 price point allowed. While still making a profit, of course.

Releasing console after console as a loss-leader just isn't sustainable. Especially, as Fit pointed out, in this economy.


RE: Just goes to show
By testbug00 on 5/23/2014 10:45:41 PM , Rating: 2
Pretty sure including marketing/etc Sony loses money per console BUT if someone gets a console and half-a-year of PSN+ (~50% of PS4s have PSN+)... they make money.

The real point of this article is Sony basically is saying if 50% of PS4 purchases come with PSN+, the console overall in in the black.


RE: Just goes to show
By cmdrdredd on 5/27/2014 8:54:15 PM , Rating: 2
No they said that on a hardware unit basis, they are turning a small profit.


RE: Just goes to show
By Digimonkey on 5/23/2014 10:43:21 AM , Rating: 3
Not really a console fan, but glad they are using basic PC hardware this time around. More importantly I hope AMD is making a healthy profit off these consoles so they can do something in the PC space that's more competitive with Intel/Nvidia.


RE: Just goes to show
By Mitch101 on 5/23/2014 5:42:09 PM , Rating: 2
They are. AMD has a completely new x86 architecture coming in Late 2015. Supposedly they have their interpretation of Hyper-theading and obviously do more IPC per core. Some time ago they must have realized they are never going to get enough from the Bulldozer architecture.
http://www.kitguru.net/components/cpu/anton-shilov...

Then you have AMD ARM chips and being that ARM chips are so small there is a hint that AMD will have an x86/ARM chip so you can run ARM and x86 natively on the same device without software emulation.


RE: Just goes to show
By testbug00 on 5/23/2014 10:38:55 PM , Rating: 2
K12 is coming in 2016.

Nothing suggests that it is x86 + ARM on one die...
The idea is you have an x86 an an ARM version, they use the same socket.

Only reason for AMD to make a part with x86 + ARM like you suggest would be if a company wanted it, and was willing to pay the R&D costs for it.


RE: Just goes to show
By hpglow on 5/24/2014 11:43:45 AM , Rating: 2
Nothing except their contract with ARM requires it if they want to use Trustzone on x86 code. So if K12 has encryption then it has an ARM core. Just like the last two APUs did (although it was disabled in the last).

I really hope AMD gets competitive with the K12 I've had little reason to replace my 2500k sandy. Sure power savings and a little IPC boost would be nice but the gains between generations haven't been that good over the last 6 years.


RE: Just goes to show
By Mitch101 on 5/24/2014 9:26:07 PM , Rating: 2
Clear up a few things.
K12 will show in 2015 and production in 2016.

x86/ARM combo chip I dont believe is a K12. BluStacks is an emulator but AMD is doing something at the core of the cpu. Supposedly they are looking at embedding an ARM core within an x86 chip in a future generation. I would expect this is low end chips so they can sell a $30.00 cpu thats is both x86 and ARM for true dual OS kind of like the Commodore 128 was dual OS.
http://community.amd.com/community/amd-blogs/amd/b...

AMD and BlueStacks Collaboration Brings Full Android OS Experience to Windows PCs
http://www.amd.com/en-us/press-releases/Pages/amd-...

I hope AMD done come with some heat for Intel and Im glad they realize their current gen doesn't have the increases everyone expected. Hope to see them back in the game.


RE: Just goes to show
By testbug00 on 5/25/2014 12:19:34 PM , Rating: 2
AMD already has ARM cores embedded in some of their APUs.

K12 is the codename for one half of their ambidextrous socket for x86 and ARMvX. release date is sometime 2016. If it ends up being 1H2016, than seeing them 2015 is highly likely, given it is 2H2016 (Which I believe) we will likely not see them until 2016.

Also, unless a large company that needs high performance ARM and x86 on the same die comes along, AMD will not be putting anything beyond simple ARM cores on higher end products. Possible if AMD tries to make something akin to the Atom chips targeting phones and wants to use x86. The R&D to get them to work well switching off, and, also, the die size increases, are not to nice.


RE: Just goes to show
By ChronoReverse on 5/23/2014 11:54:30 AM , Rating: 2
Probably was difficult to push any further. Sony already managed a more powerful console that costs a little less than their competitor which indicates to me that it's simply too difficult to get much better for the moment.


RE: Just goes to show
By Flunk on 5/23/2014 12:45:24 PM , Rating: 2
No, not really. The PS4 was specifically designed around not costing any more than they could sell it for. Custom, semi-custom, whatever. PS3 was designed to be as powerful as they could build at the time. PS4 was designed to cost $400 or less to build.

That's why both new consoles are fairly underpowered compared to current PC, which tend to cost more than $400.


RE: Just goes to show
By CaedenV on 5/23/2014 6:26:09 PM , Rating: 2
Building a $400 console is all well and good. I don't think anyone has an issue with that in particular. But the idea of today's $400 console being the standard of gaming for the next 9 years... talk about holding an industry back.

These things barely eek out 1080p with minor AA/AF when PCs have been doing that for years already. In just a few years affordable laptops will catch up, and not long after that we are going to have tablets with more horsepower than these consoles. Unless consoles hit a 4-5 year refresh instead of the traditional 8-10 year, then they are going to become irrelevant very quickly.

At least when the PS3 was released it took the better part of a year for affordable gaming PCs to catch up. This time around consoles are already a year or two behind, and it is only going to get worse going forward.


RE: Just goes to show
By StevoLincolnite on 5/23/2014 6:37:18 PM , Rating: 2
quote:
These things barely eek out 1080p with minor AA/AF when PCs have been doing that for years already.


Try Decades, if and I must stress the if you were willing to pay for it.

We had 1080P CRT monitors back in 1995 like the Integraph InterView 28hd96.

You would have had to have a stupidly powerful system to run games at that res back then though!


RE: Just goes to show
By someguy123 on 5/24/2014 1:03:56 AM , Rating: 3
What are you even talking about? Compare footage of games running on a 7850 with footage of games running on a ps4. The ps4 should offer superior performance to a 7850 thanks to much less API overhead and a large memory pool, but in reality it ends up being a bit slower (ass creed capped to 30) or visuals downgraded (hello tomb raider). Killzone 4 is getting there but its rough around the edges and fluctuates in framerate and there's decent pop-in. Seems like in-house engine advancements are what will push the ps4 ahead.

On a consumer level the ps4 is a great good deal hardware wise, but ever since the ps1 the industry has been used to a low margin/loss per unit business model while profiting in licensing and publishing. The ps3/360 being huge loss leaders and relatively powerful hardware makes me think that even "mainstream" consumers will want a new coat of paint if they try to push this generation to 7~ years.


RE: Just goes to show
By StevoLincolnite on 5/24/2014 6:52:33 AM , Rating: 2
I'm talking about resolution.

And that 1080P is not new, I'm pretty sure my prior post wasn't exactly difficult to ascertain what I was talking about...


RE: Just goes to show
By Piiman on 6/7/2014 8:58:01 AM , Rating: 2
No kidding 1995? I bet that monitor cost more than that stupidly over powered PC did.


RE: Just goes to show
By ianweck on 5/23/2014 7:36:16 PM , Rating: 2
I'd say if the PS4 is already turning a profit, then a five year refresh might not be so far fetched. At least if the PS4 is bringing in money from the hardware it might not take so long to recoup development costs.


RE: Just goes to show
By testbug00 on 5/23/2014 10:41:09 PM , Rating: 2
5 year refresh? Bollocks.

Laughable timeline for that happening. Think fast...


RE: Just goes to show
By SPOOFE on 5/23/2014 11:17:55 PM , Rating: 2
Sony makes TV's. Sony wants to sell 4K TV's, I bet. Their TV division is languishing, last I heard. They would just lo-o-o-o-ove a product that can help them push 4K.

Total conjecture: PS4K in 3 years or less.


RE: Just goes to show
By Reclaimer77 on 5/24/2014 9:25:36 AM , Rating: 2
quote:
Sony makes TV's.


Not for long...


RE: Just goes to show
By fenderkb76 on 5/27/2014 3:11:49 PM , Rating: 2
Agreed. There's no way they're going to dump a ton of money into R&D without milking that cash cow for all it's worth. 4K be darned. Sounds good on paper, but how many people are really willing to dump their current 1080p sets for newer and better. The average person probably still doesn't worry about getting blu-ray over DVD. I don't think they'll be excited to buy a new TV and 4K media device once they see the price tag. VHS to DVD was a huge jump in quality. DVD to blu-ray was a big jump on paper, but upconverting TVs and players have made it much less so. I'm really doubting the demand for 4K for all but the technologically savvy and bleeding edge types. Ask the average person on the street about 4K and they'll have no idea what you're talking about, nor will they care, nor will they be happy about laying out more cash.


RE: Just goes to show
By testbug00 on 5/23/2014 10:43:33 PM , Rating: 2
Still not sure on why everyone is thinking of a ~5 year refresh.

x86+GCN implies it is scalable, as long as it has the same CPU/GPU parts at base, you can add more stuff on anytime at the cost of die size.

Or even just power. Theoretically, Sony could just do a new spin (through AMD) on the current PS4 silicon targeting 2Ghz/1Ghz clockspeeds (CPU/GPU) and bump up the VRAM memory bandwidth.


RE: Just goes to show
By Bateluer on 5/24/2014 2:28:00 AM , Rating: 2
And you would be correct. This console generation will most definitely see a relatively quick refresh. With the Xbox One struggling with 720p, and the PS4 pretty much unable to do anything better than 1080p30, we're going to see refreshes in 3 years, 5 at the longest. Hell, next year will see high end tablets that outmuscle the Xbox One. The 8th generation console lifecycle will not be the 10 years we saw with the 360 and PS3.


RE: Just goes to show
By testbug00 on 5/25/2014 12:22:08 PM , Rating: 2
Lol. There is not a single piece of tablet silicon that can match the Xbox 360. Despite what NVidia says.

Sony will 100% be doing a PS4.x or something like that.
Microsoft, well, from what I hear, they had nothing planned like that, it could happen though.

Also, wait at least another year and a half until you say what the consoles could do... It took 3-4+ years to start to reach the full potential of the XBox 360/PS4.


RE: Just goes to show
By Reclaimer77 on 5/24/2014 9:34:44 AM , Rating: 1
quote:
and not long after that we are going to have tablets with more horsepower than these consoles.


Uhhh yeah, no. No we won't. Just...LMAO, think about it please. Battery life is a huge prohibitor of "performance" on a tablet.

quote:
At least when the PS3 was released it took the better part of a year for affordable gaming PCs to catch up.


Why do people keep saying this? It just isn't true. Gaming PC's were far ahead of the PS3 when it was released.

I don't know who started this folktale where this is the first generation of consoles that weren't ahead of gaming PC's of the time, but it's pure revisionist history.

Look I'm a PC guy too, but you guys need to get over it. People will spend catrillions of dollars on these consoles and buying the games for them, because console gamers don't care about how "relevant" you think the hardware is. That's not why they buy them in the first place!


PS4 a success?
By CaedenV on 5/23/2014 6:19:55 PM , Rating: 2
So, at what point does Sony's game division buy themselves out to unshackle themselves from the rest of Sony? PS4 can be as profitable as it wants, but if the rest of the company continues to burn so dramatically then XB1 is going to win just by staying in business.

That said, congrats to them for pummeling MS in round one of this generation's console war. Sony has always been great at launching products... not so good at supporting them after they are sold. PS3 dramatically outsold the x360, but the x360 (in spite of RROD issues) was still much more profitable because MS kept the console fresh with updates and games throughout its life cycle. With any luck Sony learned this lesson from the last gen, and will continue their success. MS needs to go back to doing what they do best in the computer market... just a few changes and the XB1 could be a great little home PC with an emphasis on gaming... but Sony needs to bleed MS a little more before they wake up to realize this.




RE: PS4 a success?
By Dribble on 5/24/2014 11:37:51 AM , Rating: 2
Over-optimistic reporting is something Sony does a lot of. I suspect the console isn't quite as profitable as they are making out. Sure it might be if you ignore enough of the costs (R&D, etc) but in the real world it's almost certainly not profitable yet. A separate Sony game division would have to take those costs.


Good to see
By atechfan on 5/23/2014 11:12:07 AM , Rating: 2
While I have no interest in the PS4, I play some of Sony Online Entertainment's games on PC. I like seeing at least something work out for them financially. The company desperately needed some good news.




no surprise...
By jmke on 5/26/2014 5:22:14 AM , Rating: 2
using last generation tech, which is outmatched by even generic boxes... it's nowhere near future proof, can't run games at 1080p at 60+fps the year the console was launched; in a few years 4k TVs will become mainstream and you have a console that can run 720p...

I'm guessing PS5 will come sooner :)




Shouldnt be profitable
By Shadowmaster625 on 5/27/2014 8:39:54 AM , Rating: 2
If they are making money off the hardware within the first year then they need to drop the price. If they dropped the price to $300 then it would deal a crippling blow to the xbox. Xbob needs to go because it is totally retarded to have two incompatible consoles that are nearly the same platform.




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