141
rate

PS3 production cost almost at break even

December 23, 2008 in News comments 6

Sony has gone a long way from when the first launch of the of the ps3 with production cost being a little over 900 dollers. They have so far dropped the production cost all the way down to $448.73 and selling most PS3's at the price of 400 dollers.

Back then, an iSuppli analysis pegged Sony's "bill of materials"—the total cost of all the components used to build it—at more than $840 for the model that sold at the time for $599, and $805 for the starter model that sold for $499, making it a money-loser for Sony. It still appears to be a loser two years later, iSuppli says, but the loss is shrinking: The PS3 now costs $448.73 to build while selling for $399. Sony subsidizes the hardware price but makes its profits on the many games that it and other game publishers sell to run on the machines.
Sayyed via businessweek.com »
Favourite this article Add source
| More
Report!
News story attached to:

Comments

Register as a member to subscribe comments.
  • 1
    The Omega Dec 23, 08
    Good, now lower the cost of the consoles so you can sell more of them, and therefore sell more games and make more money. I want to buy the PS3 eventually, just not for the amount it currently costs.
  • 1
    Red 9* Dec 23, 08
    I didn't realise they'd get this close this early! I guess this rules out a March price cut though; why drop the cost if they're this close to making a profit?
  • 0
    The Omega Dec 23, 08
    They already make a profit, just with different sources of income (the games). I hope they don't keep the console price the way it is due to the lower production costs, but I guess it's not out of the question that they will remain the same.
    • 0
      Red 9* Dec 23, 08
      I meant in their gaming division; in their other divisions, they've been cutting a profit for ages.
  • 0
    Bale Fire Dec 23, 08
    Should be breaking even early next year, which means another price cut after that. Which I think is all that is stopping the PS3 from selling.
  • 0
    Koloth Dec 23, 08
    Don't expect the price cut to be very big. If they break even early next year they might hold out until later in the year for a price cut and it might be less than $100.

    Keep in mind this is a business and in business the first priority is to make money. So unless it is more adventageous to take a loss than to try and turn a profit they will try and turn a profit first. Now that they have won the HD format war I think they will be less interested in getting the PS3 sold and more interested in making money off of it. Beating Microsoft isn't all that important really.

This news story is archived and is closed to comments now.