$600 console for $499.99 is the best case scenario for me. I know $399 has a bigger market, but $299 has a even bigger market so why not go there? I want something that isn't gimped day one like the PS4 was.
-
Ever wanted an RSS feed of all your favorite gaming news sites? Go check out our new Gaming Headlines feed! Read more about it here.
-
We have made minor adjustments to how the search bar works on ResetEra. You can read about the changes here.
Sony Q1 FY2019 (April-June) Results - PS4: 3.2m (LTD: 100 million) / 1 billion games sold / FY2019 FCT down to 15m PS4
- Thread starter ArmGunar
- Start date
$600 console for $499.99 is the best case scenario for me. I know $399 has a bigger market, but $299 has a even bigger market so why not go there? I want something that isn't gimped day one like the PS4 was.
Having a 499 beast at 399 just means Sony wil lost more money on the console for example and it is maybe because the console will stay longer at 399 dollars...
I doubt Sony would be willing to eat $100 on a console that they already priced out of the mainstream into a niche that is not as price sensitive anyways.
If the economics allowed it (i.e. price evolution of the stuff inside the console was fast enough that it would get out of the red relatively soon, the thing wouldn't tank Sony financials that badly short term, etc), that's probably something they'd look into doing.
I could be wrong but I think they mean a $499 console being sold at $100 loss. A console that cost $499 to make won't be beast. That's only like $40 more than the PS4 cost at launch.
They could do it right now. Just put out a piss weak box like the Switch. Obviously they have performance goals that prevent that. I just don't see how a console with Navi, Zen 2, top class SSD, hardware ray tracing and a sufficient amount of fast memory is going to sell for $399 without a MAJOR loss. If they can pull that off PS5 could be the GOAT.
Last edited:
I don't believe it this is wishful thinking. At one moment they will want to loss much less and with a 600 dollars to produce this is much more difficult if they decide to lost between 50 and 100 dollars it is for reaching 399 dollars price...
Maybe the console will be 499 dolalrs but they will lost much less than 100 dollars on the console maybe as much as for the PS4 20/30 dollars...
OP
OP
If we follow the logic seen last year with Sony Music and the purchase of EMI, the forecast has been changed once the deal is done and has an impact on Operating Profit
The acquisition of a studio may be just put in "Capital Expenditures" and not affected the Operating Profit forecast but will later impact the ROIC
Where did you read that Xbone x was selling better than the Ps4 pro?
Reading comprehension fail by me, specific metrics, word play.
Take your pick.
I wasn't trying to say that you were wrong, I was just asking curiously where you had heard it because it's just interesting to know that the premium Xbone is more favorable on the market than the premium Ps4.
That might have been either a specific market or percentage of the whole (e.g 40% of Xbox sales are X versus 30% of PS4).
Also, keep in mind that Reset is largely a US dominated forum. And we get sales data primarily for markets such as the US and UK (where Sony, Microsoft and Nintendo do good) and Japan (where Nintendo does good). This distorts the perspective of the overall market because it ignores all the markets that Sony does good in (or dominates), but not Microsoft or Nintendo.
You guys have got to stop Kazifying Jim Ryan. He's not remotely photogenic and just doesn't have the face to pull these gifs off.
Sony knows the template to success which is why they should price the PS5 at $399. The company's fortunes are much different this time because they have a bigger revenue stream coming in consistently (plus, now, vue, mtx, digital) so they could take a small loss on each unit and still be just fine. The impact of a $399 price announcement for PS5 would be just like the PS4.
Everyone ignored Andrew House era and kept on using Kaz's face instead of House.
It will still cost a pretty penny to build the level of console they are going with. These new consoles aren't going to come out looking shaky like PS4/X1. They will be on par with rather high level PCs out the gate. So, we may have two options (it mostly depends on the cost to build, of course).
1. The console costs ~$599 to make and they sell it for $499 and take a $100 loss.
2. The console costs ~$599 to make and they sell it for $399 and take a $199 loss.
The former is more financially responsible than the latter. They loss roughly $60 with the PS4 at launch. They can handle a bump to $99. A $199 loss? I think that is pushing it. They can get as many people as possible at $499 and then try stuff like bundling a game and/or a $50 cut to $450. And yeah, while the money is made in the software and services, I don't think that means setting yourself back that much with hardware.
Care to share the numbers on how great the One X is doing? Because last Hardware related numbers i heard of MS was a 46% decline. So no, the One X isn't showing that 499$ is a good price point, it's the opposite actually.
Andrew's got a good quiet guy image the way I see him, lol.
I just can't see him ridiculed in GIFs.
Curiuos to see what decline percentage will be in their next quarter report. Was 33% 3 months ago, now is 48%. Holiday 2020 for launching their next console will be a hard and a long wait. In the other hand, Sony can cruise on PS4 sales. I also think they won't be in any hurry for announcing next PS5 news.
Don't really think that proves much considering it's just a mid gen refresh and if you already weren't really happy with the Xbox platform in terms of software there's not much reason to upgrade and new customers might as well wait until next year at this point. $500 may not be ideal at this point in the generation but for a launch console? I think that's going to be fine, especially if all your old games work on it. Trade/sell your old system and you're back to $400.
I think people need to realize that Sony only has one chance to move game development forward for the next 7 years and they need to show a meaningful difference in features and jump in graphics and get people to say I need a ps5 especially with more competition. IMO 399 would be a pro like upgrade. 399 was a necessity coming off the back of PS3 and recession but not anymore. A 599 machine sold for 499 would be a huge jump and I hope they do that and I think they are going to.
I doubt Sony would be satisfied with the kind of numbers the X is doing. And considering they were talking about US numbers only this really doesn't tell us anything.
I'm not arguing the price, i'm just saying that the One X results are not an positive indicator for a 499 price point as he stated.
Well, Sony's next gen system would obviously sell more than a mid gen refresh. The point is that it shows a console can be successful at that price point.
US makes up the majority of MS' share. They weren't looking for it to do numbers worldwide if their cheaper console couldn't even do it. It would be like basing Pro success off of Japan numbers.
If X did well as we have been told, a 499 next gen console is viable.
Lol, no, they won't. By the time the PS5 gets launched, it will fall squarely as a mid-range PC configuration with, maybe, the custom NAND solution as a differentiator.
We have way more than two options.
Neither of these two options is likely viable. A $499 console has a way smaller addressable market than a $399 one, and the main purpose of loss leading is so you can reach as wide of a market as fast as you can so you can profit on related goods. You don't do that by limiting your addressable market. If they take any meaningful loss, is to get the pricing to a mainstream level.
A $499 console would most likely be sold at or really close to break even, at most. Like the Xbox One X itself, by the way. If you want $599 worth of hardware, be prepared to pay $599.
Though I'm inclined to 100% disagree, I'm curious as to what you think a 'rather high level PC' is to at least have a perspective.
The question is, well in relation to regular XBO sales and US market, or in relation to Pro sales and the worldwide market?
I never said it was.
Which is what I stated.
I figure it is rather obvious. The consoles will be toward the higher end of PCs rather than the lower end like with this gen.
The former.
Incredible results for Sony. IMO they can afford to take a loss on the PS5 for the first 2 years because the PS4 will be making bank regardless. The cost of building the machine will rapidly decrease in years 2,3,4 anyway so it's no major biggy.
Digital share 53%! It's going to be 60% at PS5 launch and probably end up over 75% after a few years. The profit margins for Sony will be insane.
Digital share 53%! It's going to be 60% at PS5 launch and probably end up over 75% after a few years. The profit margins for Sony will be insane.
If the point you're making is that $499 is a good price to launch a next gen console, then it doesn't really have anything to do with Xbone X launching at that price
Only thing decidedly less than mid-range-y about the PS4 was the CPU, and that's because they literally had no other option.
Not chump change, but I seriously doubt it's anywhere near the $599 people around here are dreaming.
That Sony can use the profits from the continued sale of the PS4 to subsidize initial losses of the PS5 is a point I had forgotten, and a luxury that Microsoft's XBOX division doesn't have (nor Sony between PS3 and PS4). I had always just said, "Sony is willing to take a larger hit because of how important the Playstation brand is to their overall health."
So I guess it does lend some credibility to the rumor that the PS5 will be more technologically capable than XBOX Next.
"Higher end" can be any broad spectrum of parts, which is why I asked for an idea of what you were talking about. Rumor has it, for example, that the PS5's GPU will be a 2070 equivalent (which won't be higher end in 2020). In fact, despite its RTX capabilities, it still doesn't beat my Titan Xp(s), so even now, it struggles to be considered high-end.
Regardless, my expectation is consoles on the upper side of a mid-ranged machine (which is sufficient).
Last edited:
Hmmm if that's the case then it seems most gamers don't care about 3rd party games either. Uncharted 4 sold 17M last update which is more than all other PS4 games other than GTA5.
No it means over 10 million gamers do care about it. Quite the opposite of your take.
Also $399 is harder and harder to hit because of inflation. $399 in 2013 is the same as $438 today. Personally I think Sony is going with $449 entry price for PS5.
Wasn't so long ago Jim Ryan was the butt of jokes around here.....now we have gifs of him tearing shit up.....great stuff,lol.
Purchasing power hasn't increased in pace with inflation. If anything, today it's harder to justify a $399 expense than it was 6 years ago.
Yes, but your post sounded like it is global. Both Mat and Benji doesn't have data for global market. They don't know how X and Pro are performing outside NA market.
Analyst and Investor Briefing Q&A Summary
OP
OP
Sony released their Analyst and Investor Briefing Q&A
Highlights :
Question : Although the Game segment reported a decline in profit for Q1 versus the same quarter of last fiscal year, when first-party software sales were strong, profit still looked reasonably good. How much of the previously stated 30 billion yen increase in development costs related to the nextgeneration console hit the books in Q1? Could you give us an idea of whether you expect this cost growth to be more weighted to 2H or 1H?
Question : You mentioned in your speech that demand for Free-to-Play (F2P) and other third-party software in the G&NS segment was somewhat weak. Could you give us more details on the current situation and how we should view the risks into the second half?
Question : Regarding forecast changes in the Game segment, you revised the sales outlook down by 100 billion yen, which I understand is largely because of hardware and free-to-play games, but despite the change in forex assumption and the lower sales outlook, your profit outlook remains unchanged. Has there been any change in outlook on costs or profitability?
Highlights :
- Sony is positive about Q1 performance despite decrease in Revenue & Operating Profit
- Decrease expected because Days Gone only vs God of War + Detroit last Q1
- They expected lower PS4 sales due to competitor but sales are still decent
- Costs for next-gen are trending as planned
- Sony do not plan to be aggressive with PS4... "focusing instead on raising the level of penetration while securing a profit"
- Sales of 1st party games are more or less expected
- Sales of Add-on and F2P titles were well below their expectations
- Especially sales of F2P (microtransactions) declining sharply during Q1
- PS+ Members numbers declined slightly but were largely expected, outlook is modest growth for full year
- No major downside risk for the H2's outlook but they keep a close eye on sales trends and geopolitical risks
- Operating Profit for Full Year remains unchanged partly thanks to "a degree of cost cutting" by "greater organizational flexibility"
Question : Although the Game segment reported a decline in profit for Q1 versus the same quarter of last fiscal year, when first-party software sales were strong, profit still looked reasonably good. How much of the previously stated 30 billion yen increase in development costs related to the nextgeneration console hit the books in Q1? Could you give us an idea of whether you expect this cost growth to be more weighted to 2H or 1H?
Question : You mentioned in your speech that demand for Free-to-Play (F2P) and other third-party software in the G&NS segment was somewhat weak. Could you give us more details on the current situation and how we should view the risks into the second half?
Question : Regarding forecast changes in the Game segment, you revised the sales outlook down by 100 billion yen, which I understand is largely because of hardware and free-to-play games, but despite the change in forex assumption and the lower sales outlook, your profit outlook remains unchanged. Has there been any change in outlook on costs or profitability?