Now that the PS3 has flopped as a game machine

Who knows if the 2nd and 3rd gen players are losing money. What we do know is the Sony's PS3 division is projected to lose around 2 billion this year. Maybe the cash cow lost its udders. That hurts!

And you have a reference for that number? Wouldn't that indicate that they are losing around $1,500 per system?
 
:haha :up:up:up

In other exciting Sony flop news -

Sony Forks Over Chip Production To Toshiba


Sony announced on Thursday a plan to sell its loss-making multimedia microprocessor operations to Toshiba for an undisclosed amount, hoping that its trusted joint venture partner can do a better job of supplying the brains for the PlayStation 3.

Following a month of leaks to various media outlets by unnamed sources, the world’s second-largest consumer electronics company made an announcement late on Thursday that it will unload production lines for its Cell processor in a joint venture arrangement for a reported amount of about 100 billion yen ($856.38 million) to Toshiba.

The sale, drawn up in preliminary form as a nonbinding memorandum of understanding, is the latest swing of the ax by Sony Chief Executive Howard Stringer, who has cut the workforce and closed factories to boost profitability. In February he promised to cut back on development costs for the expensive, loss-making chips and to consider outsourcing production to outside partners.

Toshiba appears to be the best available buyer: Along with IBM (nyse: IBM - news - people ), Toshiba helped Sony develop the Cell, which bundles multimedia game features onto a single chip using 65-nanometer technology. Cell is produced in a plant in Nagasaki, in southwestern Japan; costly investment would be needed to prepare it to produce chips using next-generation 45-nanometer technology.

In addition to the sale of the Cell line, Toshiba is also taking over the manufacturing equipment for a line of image-processing chips also used in the PlayStation 3. Both sides were mum on how much the sale was worth but Nikkei Business Daily reported before the announcement that the sale price was about 30 billion yen ($256.92 million).

For Toshiba (other-otc: TOSBF - news - people ), buying the Cell line would give it a huge upgrade in the system chip business, where it is lagging far behind Intel (nasdaq: INTC - news - people ) and Samsung (other-otc: SSNLF - news - people ), with the anchor of having Sony as a reliable buyer.

Toshiba makes money on every PS3 sold - which I'm not sure Sony is able to claim. :haha :haha :haha
 

First you said they were projected to loose around $2 billion this year. Then you show two links were one said they lost $1.91 billion last year and another that shows the cost breakdown of PS3 dated a year ago. So, where is the link showing the $2 billion projected loss for this year? Last years loss is more understandable because they barely started selling the unit in that year and they still had all those development costs to cover.
 
First you said they were projected to loose around $2 billion this year. Then you show two links were one said they lost $1.91 billion last year and another that shows the cost breakdown of PS3 dated a year ago. So, where is the link showing the $2 billion projected loss for this year? Last years loss is more understandable because they barely started selling the unit in that year and they still had all those development costs to cover.
The loss was through the first quarter of this year. The point is that the PS3 has really hurt Sony's financial health. Will it pull out of it? Maybe? Probably?
 
The loss was through the first quarter of this year. The point is that the PS3 has really hurt Sony's financial health. Will it pull out of it? Maybe? Probably?

OK, but how much did Microsoft lose on the 360 during the same period of it's developmental cycle (8 months development and only 4 months of actual sales)? Of course it's going to lose money while it's not being sold for most of that fiscal year.

And, before you say it, I realize they are still losing money, but it's not going to be anywhere close to $2B this year, and the number is shrinking.
 
OK, but how much did Microsoft lose on the 360 during the same period of it's developmental cycle (8 months development and only 4 months of actual sales)? Of course it's going to lose money while it's not being sold for most of that fiscal year.

And, before you say it, I realize they are still losing money, but it's not going to be anywhere close to $2B this year, and the number is shrinking.
You're right it appears to be shrinking. But, they still are projecting to lose money this fiscal year (which ends March 08).

Sony's quarterly loss widens - Earnings - MSNBC.com
 
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Your right it appears to be shrinking. But, they still are projecting to lose money this fiscal year (which ends March 08).

Sony's quarterly loss widens - Earnings - MSNBC.com

Isn't that what I said?

Again, the 360 is much further ahead in its development cycle, so I would expect them to be in better shape on a loss/earnings per unit basis. Those comparison articles you cited just talked about building the machine. I'd be curious to know how marketing, etc and the 3 year warranty Microsoft had to add figure in to the total bottom line.
 
To call the PS3 a flop when it is ahead of the XBOX360 in sales when compared to street date is a joke. To completely ignore 100 million PS2 owners who are probably waiting for the PS3 to drop in price (gonna happen this XMAX) and some really fun titles to be out (already has happened) is also a joke.

I am going out on a limb here but I believe that the PS3 will pass the XBOX360 and total units sold worldwide before next XMAS! The PS3 is already at 50% of units sold world wide against the XBOX360 and that is for being on the market and overpriced for 10 months! What is going to happen when the price hits at $399 and you start getting great games to play on it????

The PS3 is finished as a game machine? Pluzzeee --- you're breaking my heart!:river
 
To call the PS3 a flop when it is ahead of the XBOX360 in sales when compared to street date is a joke.

This comparison is a joke, only used by PS3 fanboys and I'm sick of explaining why it is stupid. (360 didn't have 3rd party titles to leech from other systems, no competing product, but higher price, overhyped PS3 in the promising not so distant future)

berk said:
Originally Posted by berck View Post
The Xbox unit lost $1.89 Billion in the last fiscal year (ending June 07). Over half of that was due to warranty issues ($1.06 Billion). Numbers don't seem that much different to the PS3 in their last fiscal year ($1.91 Billion, ending March 07).

Actually, they took a $1.06 Billion dollar charge. This means that's the money they set aside to fix the problem, which they said decreased in severity earlier than expected (they started to not get as many consoles back). I don't have the link handy, but that's what I read. So MS lost less than a billion outside of the flaw. This is important from an investment standpoint, because the loss isn't some nagging thing that hits every quarter, they decided to take the hit up front.
 
The loss was through the first quarter of this year. The point is that the PS3 has really hurt Sony's financial health. Will it pull out of it? Maybe? Probably?
I bought a PS3 just so they would have to eat more money. If I ever watch a BD movie it will be rented or even ripped from a rental someday.
 
T
Actually, they took a $1.06 Billion dollar charge. This means that's the money they set aside to fix the problem, which they said decreased in severity earlier than expected (they started to not get as many consoles back). I don't have the link handy, but that's what I read. So MS lost less than a billion outside of the flaw. This is important from an investment standpoint, because the loss isn't some nagging thing that hits every quarter, they decided to take the hit up front.

Not all of that 1.06 was 'set aside'. The xbox division was averaging about $300 mil loss each quarter leading up to the final quater. Which would put that loss around $1.2 bln. Their set aside may have been in the range of $700-900 mil.

I know a few people that work/worked for Microsoft in the same facilities as the xbox division. The problem is a poor design with dissipating the heat from both the graphics unit and CPU. The fix is a temporary band-aid solution and they will have to redesign the units to make them work correctly.
 
Let's see: The PS3 has sold about as many units as the Xbox 360 did in it's first year or so. The PS3 hardware is far more reliable (sent your 360 in for repair- yet?). There are, I believe, 3 versions of the 360 at differing price points. Must mean the 360 is down the tubes, right? Price reductions as the cost of manufacturing goes down- wow, who ever heard of that? :rolleyes:

Yep, Sony should have had more games out at rollout and supported developers more. But games are being released and better ones are on the way. "No games" and "inarguable" are only in the wishful thinking of certain people. And despite what they may "think" their opinions won't affect the success or failure of certain products one whit.

Buzz!

Sales from PS3 is severely trailing the 360 at a similar number of months on the market. More damaging though?.... They were the ONLY next gen game system to register a decrease in hardware sales last month.

Of course, a better version of Madden 08 (according to every publication I've read), BioShock, and oh yeah, Halo 3 may have stacked the deck just a tad.... Mass Effect and and a new Splinter Cell should continue the hot streak.

You got me on the reliability..... The 360 breaks too often. That's why I bought the extended warranty (just like I do with E*....). It won't cost me a dime to fix it, although knock on wood, I am still on my original launch unit. Keep 'em ventilated people, and you'll cut your chances of running into problems........ And don't lay the power brick down on a rug where it will cook... Stand it on it's side... Then again, Ferraris break down a lot, but people don't seem any less enthusiastic about them.... When they work they are real FUN. Same here...
 
I bought a PS3 just so they would have to eat more money. If I ever watch a BD movie it will be rented or even ripped from a rental someday.
Slowly moving over to the dark side.You will be surprised how well a BR player it is and how well it up converts dvds
 
Takahashi: Sony begging PS3 devs to stay on-board - Joystiq

In his writeup of yesterday's NPD numbers, reporter for The San Jose Mercury News (and man of a thousand sources) Dean Takahashi wrote, "One piece of news that came out this week was that Sony pleaded with third-party developers not to abandon its struggling platform. That change in attitude is a marked difference compared to the arrogance of past years."

Though Sony hasn't always fessed up to that perceived arrogance, we've all noticed a marked change in tone coming out of Sony following Jack Tretton's E3 keynote speech. With only one PS3 game (barely) cracking the NPD's top 10 software chart last month, convincing developers to build games for a complicated console that some even call "a waste of everyone's time" is no easy task. If Takahashi's info is accurate, it sounds like Sony's looking to preempt any developer exodus, hoping this season's delays aren't next year's cancellations.
 

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