Sony Set To Absorb PS3 Losses News
Chris Leyton
29/06/2005
Financial report suggests the sheer manufacturing costs of the Playstation3...
The costs associated with the production of the Playstation3 were today dramatically revealed by way of a report in the Toyo Keizai magazine, citing research undertaken by leading financial management and consultant firm, Merrill Lynch.
The report suggests that the manufacturing costs of the PS3 could be as high as 54,000 yen (£271) at the time of launch, which would result in an 11,000 yen (£55) loss per unit sold if SCEI intends to release the next-gen format for the alleged launch price of 44,800 yen (£225). The article goes on to suggest that the core components of the PS3 (CELL, RSX, Blu-ray) could cost close to 11,000 yen (£55) each.
Of more concern for Sony is Merrill Lynchâs belief that the Japanese giant will find it hard to absorb the losses during the first year of sale, suggesting that these could rise to 130 billion yen (£652 million) with a further 80 billion yen (£402 million) loss following a year later. Approximate calculations from a loss of £1 billion across the first two years of sale, suggests that SCEI will be looking to shift 20 million PS3 units during this period.
The report concludes with comparisons to the Xbox 360 which will arrive earlier on the market and with a reported $299 (£166) price-tag, with suggestions that Microsoft will drop the price to disrupt the launch of the Playstation3.