Sunday, October 22, 2017
Search
  
Submit your own News for
inclusion in our Site.
Click here...
Breaking News
DVDFab Debuts 4K Ultra HD Copy Software
Razer Unveils New Broadcasting Camera and Microphone
Microsoft's Cortana Gets Into Smart Speakers Market With Harman Kardon Invoke
Samsung, LG Electronics are Lagging in Autonomous Car Race
TSMC Raises Forecasts for 2017 Due to 10nm Demand, Outlines 7 and 5nm Roadmap
Samsung Said to Have Placed Huge EUV Equipment Order From ASML
Samsung Launches the Ruggedized Galaxy Tab Active2 for Business
Intel Capital Announces $60 million of New Investments in Data-Focused Startups
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
John Kodera Promoted to President and CEO at Sony Interactive Entertainment
New Sony Cyber-shot RX100 IV Supports Phase-detect AF and 24 fps Bursts
Sony Unveils New Smartphones, Audio and Imaging Products at IFA 2017
New Sony Magnetic Tape Storage Technology Supports High-Capacity 330 TB Recording
Image Sensors and Music Lead Sony's Growth
Sony Entertainment to Start Vinyl Record Production
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

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 .