PS3 is harder to cost reduce, says SCEA boss

[Spartan_X]

PS3 is harder to cost reduce, says SCEA boss

Ellie Gibson 09:30 23/01/2007

But Japanese retailers reportedly slash price

SCEA boss Jack Tretton has warned that it will be hard to cut the cost of PS3 as the machine is so expensive to make - but according to reports, some Japanese retailers have already slashed 20 per cent off the RRP.

When asked in an interview with US magazine Game Informer whether PS3 price cuts be "as soon or as drastic" as they were for PS2 Tretton replied, "No... There's a heck of a lot more under the hood and it costs us more money to make it."

But although he conceded it will be "a lot more difficult to cost reduce" PS3, Tretton said that consumers will still be willing to pay the asking price.

"I think the consumers that get their hands on a PlayStation 3 clearly see the value and not only want to buy one for $599, in some instances they're willing to pay ridiculous prices to buy one on eBay," he concluded.

However, reports suggest that demand for the hardware is already slowing in Japan. According to Media Create figures the PS3 suffered its worst sales week so far earlier this month, and now there are claims that some retailers are drastically cutting the price of PlayStation 3.

As reported on Akibablog.net and partially translated by Kotaku, some shops are said to be reducing the price for the 20GB model from YEN 49,980 (EUR 315) to YEN 39,980 (EUR 253) - a drop of 20 per cent.

But market watchers PS3 wasn't the only console to experience a post-Christmas sales slump - Media Create's figures revealed that the numbers for Nintendo Wii and Xbox 360 were also down during the same period.

Source: GamesIndustry.biz

[ToneKnee]

Using direct currency rates, the 20GB PS3 is going for ?195 (With VAT).

[KoL Veteran]

Here is a another link - http://www.joystiq.com/2007/01/22/tretton-...to-cost-reduce/

with the Wii at $250 and if MS reduce the price of the 360, they will have to do something.

[soniqstylz]

I read this somewhere else yesterday.

One of the replies did make some sense, tho. What the hell else is he going to say?

"Yes, we're going to drop the price sometime around September 12th". No one would buy one until then.

And actually, it should be easier to drop the price. Since the Blu-Ray drive is a large part of the increased cost, that price should go down once manufacturing increases (among all BDR players). DVD drives can only drop so much more, since it's established technology. Same thing with the Cell processor. They can drop fairly quickly in price. The problem is, if Sony drops the price too early, they'll never make any of that R&D money back.

I don't think they dropped the price on the PS2 until the Xbox had it's first price drop, did they?

[John Veteran]

And actually, it should be easier to drop the price. Since the Blu-Ray drive is a large part of the increased cost, that price should go down once manufacturing increases (among all BDR players). DVD drives can only drop so much more, since it's established technology. Same thing with the Cell processor. They can drop fairly quickly in price. The problem is, if Sony drops the price too early, they'll never make any of that R&D money back.

I don't think they dropped the price on the PS2 until the Xbox had it's first price drop, did they?

You're right, it should be easier to lower the cost. But it depends on several factors, so we'll have to wait and see...

And the PS2 dropped in price first IIRC, and the Xbox promptly follow suit.