Sony's In Trouble (Again)...PS3 Pushed Back 6-12 Months....

...Date anyway ( or a month or so before, just to build up the buzz leading up to Christmas).

You are right about a "spec" here turning into a "speck" there.

LOL

...that the actual U.S. launch is indeed JIT for Christmas. I don't know how good Merrill Lynch is at analysing tech developments, but they did hold out the possibility of a more pessimistic caveat of an early '07 U.S. launch in their report. Sony has denied that naturally, but they also initially denied ANY slip in their launch schedules at all, both for the U.S. and Japan markets, only to have some company reps come back and quietly confirm that the rumours of sliding launch dates are indeed ok if they happen, as if they're preparing the world for the inevitable.

From what I've been reading, it sounds like there's problems with the BluRay consortium in finalizing some of the standards involved, which of course is one of the key selling points of the PS3. The Merrill report cites possible production problems with the nVidia graphics set as well, and issues with the new type of RAM that the PS3 uses. Given the technology it packs, I've tended to believe that the PS3 would sell for around $600 around launch given its capabilities and intent on being the all-in-one media center of a household that goes well beyond just being a gaming console; it just seems like a nice number to me, without being too scary.

But IF Merrill is correct in their analysis, can Sony really afford to lose $300 a unit at the time of launch, even if everyone KNOWS that they're depending upon making it up on the software? Both Sony and MSFT have lost money on their prior respective PS2 and Xbox/Xbox 360 consoles, but $300 worth of hurt?

If nothing else, it makes a lot of Sony investors VERY unhappy.

...The stores that sell this thing still expect to make a profit so the presumed $600 selling price has to have a nice cut for them before Sony gets whatever's left over. And Sony has to pay to ship these from Japan and ship them to the big box stores so I'd suggest that from a $600 sale price per unit, Sony would be lucky to see $400 net. that would mean a unit sales loss of ~$500.

Ouch!!!!

I'd make a lousy retailer. Or wholesaler, for that matter.

Even if Sony has a 75% margin for a $600 list price, they'll be set to lose $450 per machine. Ouch...that's a LOT of different games they'd have to sell before ever breaking even.

...Unless you want to lose money.

The manufacturer has to make a profit (Sony), it costs to ship the stuff and the end seller has to make a profit.

..The linked article gives an estimated top number of $900.

>>>Sony?s shares fell as much as 4.4 percent on Monday after Merrill Lynch said in a research note last week that the PS3?s launch might be delayed by six to 12 months and the cost of production could initially approach $900 per unit.<<<

http://www.msnbc.msn.com/id/11458047/

..The linked article gives an estimated top number of $900.

>>>Sony?s shares fell as much as 4.4 percent on Monday after Merrill Lynch said in a research note last week that the PS3?s launch might be delayed by six to 12 months and the cost of production could initially approach $900 per unit.<<<

http://www.msnbc.msn.com/id/11458047/

It very well could be 900 dollars a system, we are not going to pay that though. Much the same way the 360 costs 525 a system. There is a counteract measure to keep the hardware affordable

I didn't read the report, but the extra $100 might be labor, assembly, testing, chassis, power cords, etc. There's a lot of overhead to stuff like this.

Speleo.