Tuesday, June 27, 2017
Search
  
Submit your own News for
inclusion in our Site.
Click here...
Breaking News
European Commission Fines Google Record 2.42 billion Euros For Giving Advantage to own Comparison Shopping Service in Search
Fujitsu Virtual Machine Control Technology Improves Server Density
Samsung Foundry Focuses on 6nm Process to Beat TSMC
Sprint Starts Partnership Talks With US Cable TV Providers Charter Communications and Comcast
Western Digital Resubmits Bid for Toshiba Chip Unit
NVIDIA Collaborates with Volvo to Bring AI-Enabled Autonomous Vehicles to Market in 2021
Sony's "Core Libraries" of Deep Learning Tools are now Open source
Micron Lexar Removable Storage Retail Business Discontinued
Active Discussions
Which of these DVD media are the best, most durable?
How to back up a PS2 DL game
Copy a protected DVD?
roxio issues with xp pro
Help make DVDInfoPro better with dvdinfomantis!!!
menu making
Optiarc AD-7260S review
cdrw trouble
 Home > News > Games > Sony Lo...
Last 7 Days News : SU MO TU WE TH FR SA All News

Tuesday, June 24, 2008
Sony Lost Over $3 Billion To PS3 Cost


Sony's PlayStation 3 pricing strategy to offer PS3 below its production cost has caused the company to lose around $3bn over the past two fiscal years.

According to Sony's fiscal 2008 annual report, pricing the PlayStation 3 below its production cost caused Sony to lose 232.3 billion yen ($2.16 billion) in 2007 and 124.5 billion yen ($1.16 billion) in 2008.

"The large-scale investment required during the development and introductory period of a new gaming platform may not be fully recovered," Sony said.

Sony said that developing and providing products that maintain competitiveness over an extended life-cycle requires large-scale investment relating to research and development, particularly during the development and introductory period of a new platform.

In the past, large-scale investment relating to capital expenditures and research and development for the manufacture of key components, including semiconductors supplied for PLAYSTATION3, was also recorded within the Electronics segment.

Despite the losses, Sony is still willing to offer the console even for free, according to a report by Tweak Town. Sony is expected to offer in Australia a PS3 with every purchase of a Sony Bravia TV.

"It is particularly important in the Game segment that these products are provided to consumers at competitive prices to ensure the favorable market penetration of the platform," Sony added.

Should the PS3 platform fail to achieve such favorable market penetration, there is a risk that this investment, or a part thereof, will not be recouped, resulting in a significant negative impact on Sony's profitability. In addition, even if Sony is able to sufficiently recoup its investment, significant negative impact on Sony's operating results could occur during the introductory period of the platform. Further, even if the platform is ultimately successful, it may take longer than expected to recoup the investment, resulting in a negative impact on Sony's profitability.

An example of such a significant negative impact during the introductory period of a platform are PS3-related charges that resulted in losses of 232.3 billion yen and 124.5 billion yen within the Game segment for the fiscal years ended March 31, 2007 and 2008, respectively. These losses arose from the strategic pricing of PS3 hardware at points lower than its production cost.


Previous
Next
Catalyst Hotfix For Radeon HD 4800 Series        All News        Asus Unleashes the Latest Intel P45 Chipset Based ROG Motherboard
PSP v4.01 Update     Games News      PS3 Firmware v2.36 Coming Soon, v2.40 to Include Trophies, In-game XMB

Get RSS feed Easy Print E-Mail this Message

Related News
Sony Xperia XZ Premium Flagship And Xperia Touch Projector will Cost You a Fortune
Sony Chief Promises Return to Profitability
Sony Returns to the OLED TV Market With New Models
Image Sensors, Batteries And Playstation Boosts Sony's Profit
Sony Launches The a9 24MP 20fps Full-frame Sports Camera
Sony Commercializes High-Sensitivity CMOS Image Sensor for Automotive Cameras
E Ink and Sony to Establish a Joint Venture to Operate Electronic Paper Display Business
Sony Introduces Extended Life Solid State Drives
MWC: Sony Adds Four New Photo-centric Smartphones To X-series
Sony Unveils Pricing And Availability Of 2017 4K HDR Ultra HD TVs And Ultra HD Blu-ray Player
Sony Develops the First 3-Layer Stacked CMOS Image Sensor with DRAM for Smartphones
Sony's Profit Dropped Despite Healthy Video Game Business

Most Popular News
 
Home | News | All News | Reviews | Articles | Guides | Download | Expert Area | Forum | Site Info
Site best viewed at 1024x768+ - CDRINFO.COM 1998-2017 - All rights reserved -
Privacy policy - Contact Us .