Sony risks losing more development funds to Nintendo without price cut according to publishers

Game publishers are pressuring Sony to cut the price of the PlayStation 3 or face the risk of more development funds shifting to the Nintendo Wii according to a Bloomberg article. Sony, which used to be the undisputed industry leader, currently sits in third place for this generation’s line up of video game consoles. As the VGCHARTZ sales numbers show, the Nintendo Wii has an iron grip on first place, the Microsoft Xbox 360 sits in second, and the Sony PlayStation 3 is third. 

Multiple publishers in the Bloomberg article laid down the bottom line they face due to the way console sales have played out. Development is divided in to software titles for the best selling Nintendo Wii and software titles for the rest of the market which consist of the PlayStation 3, the Xbox 360, and the PC.

Electronic Arts’ Peter Moore very directly stated in the Bloomberg article, "You can't ignore the guy who has half the market." Evan Wilson, an analyst at Pacific Crest Securities in Portland, Oregon believes Xbox 360 and PlayStation 3 titles are typically more expensive to produce and as a result, “The publishers need the PS3 install base to grow in order for most of these games to be profitable.”

Recently, Sony has enjoyed some momentum
due to the release of quality exclusive titles for the PlayStation 3. Killzone 2 has lived up to the hype and has received high reviews. Sony has also signed a deal with NBC Universal to deliver movies and television to the PlayStation 3. In Japan, the PlayStation 3 recently out sold all competitors thanks to the release of another highly touted exclusive Yakuza 3 or Ryu Ga Gotoku 3.

Due to the success Sony has recently enjoyed, a price cut in the near future may be a wise choice in order to keep the momentum going. All past queries about the possibility of a PlayStation 3 price cut have been turned down by various Sony executives. Combining a continuous stream of solid exclusive software titles with a cheaper PlayStation 3 may be what is needed for Sony to compete for second place with Microsoft.

"We shipped it on Saturday. Then on Sunday, we rested." -- Steve Jobs on the iPad launch

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