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[PS3Fan]PS3 53% Less To Make Then At Launch

post #1 of 43
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It's well known that Sony's latest console is a powerful, expensive piece of tech. When Sony launched the PS3, it lost over $200 on every unit sold -- in spite of its $600 price point. However, over time Sony has been able to reduce the costs of manufacturing the system, by removing PS2 compatibility and switching over to a more efficient 65-nanometer chips.

iSuppli, the company which broke down the PS3 at launch, estimated the cost of making a PS3 was more than $840. Now, they say the PS3 costs 53% less to make -- at around $445, for a system which sells at $400. Sony is still losing money on each system sold, but in a much less extraordinary way.

Not only are the individual components cheaper to make, there are simply less things inside a modern PS3. According to iSuppli, the number of parts inside a PS3 has fallen from 4,048 to only 2,820. Since launch, Sony has reworked the innards of the PS3 to include combined chips. The falling price of components also helps Sony a lot: the Cell processor cost $89 at launch, but now only costs $46 to make.

Sony should be able to break even with the PS3 starting in 2009, which makes us wonder if they'll start adopting a more aggressive price strategy late next year. We hope so -- they need a way to make themselves attractive to customers, without breaking the bank.

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Nemesis NE-α
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post #2 of 43
you get what you pay for... or more lol. love it
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post #3 of 43
interesting...good article.
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post #4 of 43
I remember telling these idiots that it costs over $800 just to make one PS3 during its launch. They laughed at me, which I find to be rather odd. They laughed at facts and made themselves look foolish. Even in honors classes, I'm still surrounded by idiots... *sigh*
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post #5 of 43
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Quote:
Originally Posted by onexero View Post
I remember telling these idiots that it costs over $800 just to make one PS3 during its launch. They laughed at me, which I find to be rather odd. They laughed at facts and made themselves look foolish. Even in honors classes, I'm still surrounded by idiots... *sigh*
Welcome to my world.
I deal with those kinds of people every day in school and in general. Doesn't matter what we're talking about, its like unless you show the official documents - they don't believe you.
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post #6 of 43
I think Sony will be reluctant to drop the price once they become profitable. They've lost so much money this generation its not even funny.

On the other hand, I could see a $150 360 arcade sometime next year so they may have to bite the bullet just to stay competitive.
    
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post #7 of 43
Quote:
Originally Posted by nathris View Post
I think Sony will be reluctant to drop the price once they become profitable. They've lost so much money this generation its not even funny.

On the other hand, I could see a $150 360 arcade sometime next year so they may have to bite the bullet just to stay competitive.
Agreed, isn't MS making profit on all 360s even at the 200 price point these days? And if not the Arcade then surely the upper end models, a 60GB/120GB HD can't cost them more than a few bucks to slap on there.
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post #8 of 43
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Quote:
Originally Posted by nathris View Post
I think Sony will be reluctant to drop the price once they become profitable. They've lost so much money this generation its not even funny.

On the other hand, I could see a $150 360 arcade sometime next year so they may have to bite the bullet just to stay competitive.
They said that all the profit generated from PS2 sales went down the drain completely.

But - on the bright side - image the profit Sony will be raking in from Blu-Ray. The only reason Blu-Ray really had a step up from HD DVD was the PS3. So in the long run, Sony will benefit. Just it will take time. :-/
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post #9 of 43
Quote:
Originally Posted by OmegaNemesis28 View Post
They said that all the profit generated from PS2 sales went down the drain completely.

But - on the bright side - image the profit Sony will be raking in from Blu-Ray. The only reason Blu-Ray really had a step up from HD DVD was the PS3. So in the long run, Sony will benefit. Just it will take time. :-/
In the long run, Blu-Ray may become irrelevant. Notice how the increase download media? (NetFlix is avaliable on everything, higher quality YouTube, Hulu, ect). Combine that with the fact that most people can't tell the difference between 1080p vs 720p.... or Blu-Ray vs upscaled DVD. If Blu-Ray does not win more marketshare in the next few years, it may become secondary to download services.
Once again...
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Once again...
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post #10 of 43
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Quote:
Originally Posted by DuckieHo View Post
In the long run, Blu-Ray may become irrelevant. Notice how the increase download media? (NetFlix is avaliable on everything, higher quality YouTube, Hulu, ect). Combine that with the fact that most people can't tell the difference between 1080p vs 720p.... or Blu-Ray vs upscaled DVD. If Blu-Ray does not win more marketshare in the next few years, it may become secondary to download services.
Older people are still nowhere near close to understanding how to use services like Netflix.

I show my parents, my relatives, hell even my friends Hulu.com - and they are just like "OMG THATS AMAZING! I must check that out some time!". They never do because they either completely forget or don't know how to use such a service.

People still have DSL and dial up connections which completely disables the chance of using that service. Also - majority of the people (including me) still want physical discs so its ALWAYS available.

Like you said about the 1080p vs 720p - people can't tell the difference. You're absolutely right. But - majority of the people don't care or realize this. They are just going to buy the "better buy."
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