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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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?

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