XzDoG wrote:

Xoox, then the arguement that you dont have a super powerfull computer comes into play. I have a shitty laptop, I need my xbox to play games because my PC cannot play the ports.

For the money spent on an XBox 360, you could build a badass computer.

Of the top ten games to sell in 2005, 8 of them were PS2 games. The top selling game was a PS2 game. Sony holds about 70% of the global market, with Nintendo struggling to keep it's 15% and Microsoft doing it's best to wrestle some points from Sony. Nintendo has a nice hold on the portable market, and looks to be top dog there for some time. As far as consoles go, however, Sony has them all beat. This 20% loss to Microsoft, if it happens, will still leave Sony with 50% of total gaming dollars, and Nintendo and Microsoft battling for the scraps.

~X

Divine Apprentice wrote:

I'd probably be willing to pay over 1,000 bucks for it.

Just out of interest why would you be willing to pay that much for it? It doesn't seem like the PS3 will have a line-up strong enough to push someone to buy one (with a $700+ pricetag) upon release when they could wait the price out a little and live with a PS2.

Xooxer wrote:

Sony isn't going to release a system that costs more than the others, even if it means taking a big loss in sales in the opening quarter.

I think you missed the point. Everyone plans to take a loss to begin with. If worst comes to worst you take a big loss. No one will even flinch at that.
However if things work out this way it'll be an insanely big loss. One they wont be able to afford to take. It'll be a simple matter of being so far in debt that they wont be able to borrow anymore money to pay the electricity bills at the end of the month.
The other thing is they're not just looking at a loss during the first quater (although it never is). They'll really have to slug it out for a while before they can turn it around.
They planned to have their belts tight, now they've hit a bump and have to figure out how to make a tight belt tighter.

They could probably afford to ship the PS3 at a complete loss and still not bat an eye.

No they couldn't. As big as Sony are they like to stretch their resources thin. You're really giving them too much credit because they're huge and popular.

a report by Merill Lynch, a company with no experience in game markets, very little information and a lot of assumptions.

It's not really a situation where you need experience in that specific area. The console market isn't some magic wonderland where up is down and down is up. It still lives by the same rules as other markets even if they do have to be applied differently.

They didn't take into consideration the fact that Sony intends on selling the early models at a loss, or that their production costs would rapidly drop after release.

Yes they did. They would have to be outright drunk not to look at the markets history before this. They're analysts. They make money by being good at predicting markets. They're not going to flush the reputation that puts food on their tables down the toilet for the sake of making random, half-assed comments about huge companies.
I believe at the start of one of those articles it actually compares the loss to the XBox 360 (and we all know the 360 is taking a fair gamble in terms of the amount they're losing).

They don't mention the 8 billion other products Sony manufactures which have mighty healthy profit margins

Yes and no. They've got a lot of healthy stuff but they've got unhealthy stuff as well. Plus Sony executives aren't going to move into crappy little appartments for the next five years just to keep this devision afloat.
Appart from situations where something does surprisingly well profit is usually spent before it's even been made. When they encounter a curve ball like this they can't just go 'ok, is that ten billion dollars profit we made still sitting in the back room?' and use it to cover their butts.
They have to reorder all their plans for the use of profit and still maintain a safety net in case something outright flops. If the Network Walkman they've already put on shelves is insanely unpopular they're going to need money to pay off everything so they can cut the cord. In that situation they actually need the money in their hand at that point in time or else they'll have to sell something good to cover it.



I agree that this wont take Sony down, but this is serious business. Then again I'm sure they'll pull an ace out of somewhere and smooth it all over so everyone forgets this, no matter how much damage it does.

Well, right now anyhow. My PC can run any of the games the XBox 360 has to date fine. Next-gen consoles are designed with scalability in mind, and to build a PC that actually battles the power of one of those consoles would be unbelievably high. The one thing that still let me down on the newer consoles is that the sound technology on them doesn't seem to be increasing very well.

I have Need for Speed: Most Wanted, and after playing it for a few months you can tell that alot of the sounds repeat(tires screetching, for example). It also doesn't seem to support surround sound, which puts my 7.1 to waste. I don't think any of the newer consoles even support anything past 5.1 =( It's a shame.

I don't agree Sony rules the market, but I am not going to sit here and argue with an obvious Sony Fan.

Also I suggest you go re-read whatever it is you are getting your information from. Nintendo is doing just as well as Sony with a combined sales of all 3 systems.