PS3 may slip to 2007? depending on Xbox360 performance

[sabre2922]

Sony strategists may see a priced-down PS2 as all the company needs in '06; would ride $99 sticker--and profits--all the way to 2007.
Buried in an analyst's memo, written shortly after last week's Electronic Arts earnings call, was a hidden gem. According to the widely read team at Wedbush Morgan Securities, Sony may delay the release of the PlayStation 3 until 2007--if exactly the right conditions prevail.


Currently, the console is slated to appear in Japan before the end of that company's fiscal year--March 31, 2006--and in North America before the end of 2006.

Given the right set of circumstances, however, that release window (at least in North America) could intentionally lag until after the 2006 holiday buying season.

In a research memo sent to investors, Wedbush senior analyst Michael Pachter set up the following scene for a delayed PS3 launch. It starts with the current-generation Xbox being priced down to $99 post-Xbox 360 launch, but no lower. Concurrent with that situation--an Xbox 360 at an unspecified price and the Xbox at $99--Sony would drop the price of the PlayStation 2 to $99.

There are two components to that pricing strategy: the first is that a $99 PS2 would offer a significant distraction as the 360 launches. As Pachter states: "We believe that the company will attempt to disrupt the Xbox 360 launch with a price cut, and as a result may succeed in diverting attention away from the higher-priced next-generation console."

In addition to the "diversion rationale" is the supporting fact that "the redesigned PS2 carries a manufacturing cost of less than $99," according to Pachter. New consoles are noteworthy for the fact that at the beginning of their manufacturing cycle, the units are sold at a loss. Given that the PS2, according to Pachter, would cost less to make than to sell, it behooves Sony to extend demand for that product for as long as possible. And if Microsoft takes the Xbox price no lower than $99 (still a loss for Microsoft, according to Pachter), Sony will find itself in a win-win situation.

Another cornerstone in Pachter's theory is Sony not wanting to disappoint consumers and retailers by having too few units in the channel over the high-demand weeks of this coming December. Pachter says, "we believe that Sony suffered the ignominy of being unable to satisfy holiday ['04] demand in order to increase its gross profits over the short term."

If the PS3 launches in late '06 and suffers the same fate, Sony would be embarrassed for a second straight year. Without any PS3's in the channel, there's no chance of a shortage of stock. A backward theory perhaps, but a theory based in fact nonetheless.

The key point in Pachter's argument weighs heavily on what sort of showing the 360 has at launch. If the 360 tallies significant sales early, Sony would need to fire on all cylinders and get the PS3 into the channel ASAP. However: "Should Microsoft fail to garner sufficient software support to gain an insurmountable lead, we think that there is a possibility that the PS3 launch will slip into early 2007."

Following the distribution of the memo last week, GameSpot spoke with Pachter who emphasized that he "posited the thought as option value for Sony." Continuing, he said, "I think the 360 will do quite well."

But if the 360 does an about-face at launch and tanks, the above Plan B could be an option the cash-strapped Sony might just consider.

By Curt Feldman -- GameSpot

[chrisbid]

it doesnt really matter when the system lanuches, i wont pay more than $199 for a PS3 or an XBox 360. It looks like i wont have either system until 2008

[sabre2922]

For 99$ I plan on putting my money in a new Xbox and another slim model PS2 since my current one gets so much play time.

I would like to get an Xbox360 at launch but that seems highly unlikely.

I also regret not pruchasing a couple more NEW Dreamcast units when they were marked down to 50$ a few years ago :( and I will not make that mistake again.

Im going to take full advantage of all the cheap PS2 and Xbox games and sytems this time around Im not going to miss out on all the great deals just to get a new system and a couple games ;)

[s1lence]

Im going to take full advantage of all the cheap PS2 and Xbox games and sytems this time around Im not going to miss out on all the great deals just to get a new system and a couple games ;)

Oh for sure the cheap games and systems (xbox, ps2 slim for me). I wonder if the gamecube will drop in price again, I would be game for a 50 dollar gamecube.

[Muscelli]

good news either way.. perhaps the ps3 price could drop during the delay

[s1lence]

How about the 360 price dropping if the ps3 waits till 2007.

[Trebuken]

They only way the 360 can fail is if there is not enough units produced which seems to be happening. Have you tried to reserve one? I got the last resevation at me EBGames and it does not look like more are coming, and if I am not mistaking production of the units is only now about to begin, since developeers should have received their final development units (not sure if this has happened yet or not). I do believe Microsoft will be controlling the number of systems released at a pace that can be susteained by software sales, since they will probably lose a ton of money on each unit.

Also, if there is not enough titles ready it could fail. The PSP and DS seem to have been released too soon, but I think Quake 4, Gears of War, and several of the other titles will sustain the 360 by themselves as long as their release dates don't slip...

I believe I read that there will be a model of Xbox 360 released with a HD-DVD drive. I suspect this will be released up against the PS3, and will probably have one or two other surprises to go with it (how about a Halo 3 co-release).

Not interested in another PS2 model coming out unless it is a handheld...

Trebuken

[BrokenFlight]

Not interested in another PS2 model coming out unless it is a handheld...

Trebuken

You mean the PSP?

[JJNova]

Whoa. If you are going to leech a news update from Slashdot, make sure you read through the comments there before posting it in DP. Considering that this "insiders source" wound up just being a guy that sits in his basement, watching Sony's stock rise and fall.

[GrandAmChandler]

My price point for any new console based system is $149.99. It better make me want to buy it right away or I will wait.... My price point for any new handheld is $149.99 and it needs to come with a game, other wise my new handheld price point is $99.99. (Hear that Sony?) This does not include used pricing..

I agree with Chrisbid when I say I won't be getting either of these systems (or a PSP) for quite some time..

[RCM]

I guess that would mean no Halo 3 till 2007.

THE ONE, THE ONLY- RCM

[njiska]

Even if it was just made up by some idiot it doesn't change the fact that it is possible. It's based upon the 360 failing however and if that happens the devil had better know how to skate.

360 will succeed and capture a large part of the market. Sony will most likely launch the PS3 in Japan in Spring and in the US in Fall. It will cost a fortune. Then things will get ineresting.

Anyone who knows Sony's track record with quality hopefully won't buy a launch PS3 and it's cost will keep causual gamers from buying it. But the fanboys will still be there to support Square-Sony.

If a major FF game is announced for the 360 before the PS3 launches Sony is gonna be hurting.

[JJNova]

Anyone who knows Sony's track record with quality hopefully won't buy a launch PS3 and it's cost will keep causual gamers from buying it. But the fanboys will still be there to support Square-Sony.


HA HA HA HA HA.

The too expensive for casual gamers comment made me think about a group of guys at work.

I was trying to explain to them why they should at least look at what the other consoles of the future have to offer. They wouldn't dare. Not because they are Sony fanboys, but because they are Madden fanboys. Apparently, somewhow, there are people confused that Madden is either exclusive to Playstations, or that Madden is better on Playstations. Regardless, when I told them the estimated figure to purchase a PS3, not a one of them flinched.

[Cmtz]

If this happens more than likely the Revolution won't come out until 2007 as well. They don't want Sony to steal their ideas.

[PDorr3]

good news for me, no way I can afford both the 360 and ps3 both together....

[Lothars]

If this does happen, I could see the PS3 coming along at a cheaper price with a whole lot of launch games,

also it could do a big hurting to xbox 360 which I don't know how well it will do even if they have a year ahead, but we will see what happens.

[FurinkanianFrood]

i wont pay more than $199 for a PS3 or an XBox 360. It looks like i wont have either system until 2008


Actually, the 360 may be able to hit that price point in 2007 I'd think.

And if the high price of the PS3 kills it off it will get cheaper, though it will still be overcosted.

Like I have been saying repeatedly in posts for some time now, Sony is screwed this time.

I don't know what the 360 will sell for, but realistically it will be less than PS3. If the PS3 costs as much as one would expect, it should give time for MS to adjust the price of the 360 to a relatively saleable point (the $300 mark), if they don't try to go for that at launch (yes, the would bleed money out the wazoo, but PS2 and XBOX are both doing that already).

Honestly, if a console isn't selling worth a damn because of costy how do you think that will affect development for the system.

Major Sony supporters are slowly moving into a more platform agnostic stance. Squeenix has started talking about FF and DQuest becoming truly multi-platform series, and not just the token crap of the last couple years.

While I don't expect the 360 to fly in Japan, developers are consistently increasing development. The price issue will both accelerate this, and development for the rev also.

High profile games that are thought to be a potential messiah for PS3 will just jump ship or be abandoned. FF13 for instance will have enormous development costs attached. The PS3 version may either be scrapped or augmented with another version, or jump ship. Casual Japanese gamers will notice.

Eventually some big PS3 projects will conjure memories of what happened to Namida for PCFX, though they will not hibernate so damn long this time, and will just be a boon to the competition.

JP game market is depressed, and the old boom economy that could have supported frivolous crap like PS3 on a mass scale is long gone.

America isn't ready for Blu-ray, and there will only be token support at PS3 launch. The development difficulties with the PS3 will limit the impressiveness of games. Can you imagine something ultra-expensive without even looking like next-gen? It should be freakin' hilarious.

The PS3 will take along time to actually die in Japan of course, but so did the PC-FX, technically.

I still believe Nintendo will take back JP some day.

Even now they are the only console company making a profit.
DS sales in Japan are more than twice that of PSP.

Nintendo is still most successful game publisher in Japan.

People like to ignore the numbers, but if you take a moment to look it's Sony and MS that are having a tough time of it.

The momentum is clearly in favor of the DS, leaving Nintendo fairly safe for some time yet.

The sales of PS2 in the US are driven by stuff like sports games, GTA and such, are they not? If someone just has to have next gen Madden, and the 360 cost a hundred or more less, you just guess which one they would choose.

As far as PS3's fate, the writing is on the wall.

Game over, Sony, game over.....

The first ray of the new rising sun will soon be upon us.


which I don't know how well it will do even if they have a year ahead


Actually, they would have to show up last (i.e. in 2007) to get the price down enough, and to give enough time to shore up the launch stuff to generational standards. By that time it would be too late, and it would still cost more.......



when I told them the estimated figure to purchase a PS3, not a one of them flinched.

They won't now, but even if they still are that way later, there is always the issue of whether such fools can even afford to buy the damn thing. Damn Madden fans are morons. It wasn't even the better football series until it became the only one.

And you have to admit that the price point will cut into Sony's market share somewhat.

[Push Upstairs]

So this talk of a $99 XBOX isnt true? :(

[FurinkanianFrood]

So this talk of a $99 XBOX isnt true?


Who said that?

They could may do that to move back stock of the orig. XBOX.

[FurinkanianFrood]

They only way the 360 can fail is if there is not enough units produced which seems to be happening.


There weren't many PS2s at launch either. I worked at a games tore at the time. It was insane. Not far from here people got shot and bludgeoned to death for the things.

MS could shore up numbers in the meantime, and recover, especially with the whole cost thing with PS3.

Actually, the only way the 360 could fail is if it has as much of a cost issue as PS3, but it may well be $300. I think over $400 at launch is the breaking point.

Even at $400 the PS3 would have a hard time, especially with development difficulties keeping stuff unimpressive.

And I don't think Sony can afford to sell it for that price. The absolute minimum they can afford would $450 with $60-$70 games I think, and again, $400 wouldn't necessarily play out well either. At $400 it would be like a rerun of the Saturn launch just with a less damaged brand name. It still wouild fail.



the first is that a $99 PS2 would offer a significant distraction


How would that work when everyone but me already has one?
And I've owned 3 of the damn things.



no Halo 3 till 2007.

Never would be fine by me, though I enjoyed playing through the campaign in the first Halo. Let's see something else. It's already gotten old IMO.

People don't care about price, eh? Try telling Trip Hawkins that....... The 3DO sure tore up the market didn't it.

[Lothars]

Game over, Sony, game over.....

The first ray of the new rising sun will soon be upon us.


well I fully disagree, I think with the PS3 supporting the new format as in Blue Ray, will give them eventually victory in the console wars I would rather buy a Ps3 because it gives Blue ray format as well as backward compatibility than the 360 which only offers dvd and not that good of backwards compatibility.

Microsoft I also believe that they are making alot of mistakes with the 360 and that will be a extremely damaging thing for them.

though on topic of PS3, they may launch at a higher price than than the 360 but I think they will be the same launch price, and well i can see nintendo doing exremely well with the revolution, I don't see Sony losing that much ground at all, they haven't made a mistake that big if at all I can see.

We will see what happens and go from there. but I predict by the end of this next generation

1. Sony by pretty far in first
2. Nintendo It will come down to a close battle with Nintedo reclaiming alot of lost ground but it depends on what they do coming up
3. Microsoft, The mistakes I think they seem like they will make is gonna be big, and will cost them in the end.

but we will see what happens, I may be totally off, I have no clue.

[FurinkanianFrood]

well I fully disagree, I think with the PS3 supporting the new format as in Blue Ray, will give them eventually victory in the console wars I would rather buy a Ps3 because it gives Blue ray format as well as backward compatibility than the 360 which only offers dvd and not that good of backwards compatibility.


So you don't buy consoles for the games or what?

I still believe that the PS2 was the exception when it comes to non game features being a crucial factor. It was an exact convergence of factors that will not be seen again.

The PS2 cost is an estimated $200 dollars less than PS3, and it was timed perfectly to take advantage of DVD functionality.

The timing is off, and so is the price this time. And last time there was no real competition either because jerks skipped out on the DC in such droves.

The American market will not accept a new DVD format quickly enough. That is what would prevent your scenario in my view.

Blu-ray isn't the sure thing interenet hypesters think it is. That is not to say that HD-DVD will win either.

I believe that either both will be failed interim formats that never achieve proper market penetration in the US like Laserdisc, SVHS and such, or that one will eventually be taken out of mothballs at some future date, renamed to disassociate it from a failed format, and so on, likely Blu-ray.

Also, I don't know anyone who has or intends to buy a HDTV in the foreseeable future. When I ask, they always agree with me that it is a waste of money. And I occasionally buy $300 Neo Geo AES carts for pete's sake.

I don't know about where other folks live, but around here the upper middle class are the ones who mess with this crap, and they aren't exactly legion.

People I know don't want to have to buy movies again, especially not at $40.

By the time the US market is ready for Blu-ray, the PS3 will have had it's ass kicked already as a game console, and the loss of developer support and reputation with consumers will be be irrecoverable.

WIth PS2, the movie playback was a boon that held it over while the software lineup took it's own good time to materialize properly.

This time the PS3 would need to fall back on games while the Blu-ray stuff slowly arrives on the scene.

It's really more an opposite scenario, and the launch games won't be any better than PS2 either. The added cost will hurt sales. Developers will be frightened off.

Even if the Blu-ray then allows it to sell, it will be less of a force in the game market than a midway compromise between a console and a set top box. The damage would already be done.

[FurinkanianFrood]

Whoops! :embarrassed: Accidental double post frenzy.

[Push Upstairs]

The American market will not accept a new DVD format quickly enough. That is what would prevent your scenario in my view.

Indeed. Asking everyone to buy thier movies all over again after they just jumped to DVD barely 5 years ago is asking alot.

I got into DVD in 1999 and i'm not ready to go HD yet. I remember working retail around DVD's at the time and even in 2001 people were still clinging onto VHS.

[Trebuken]

Sonyy and Microsoft are two immense companies who have teams and teams of people dedicated to the development and promotion of new technology and the sale of that technology. Neither system will fail, they money they invest creates their success. Nintendo while being profitable, is not guaranteed any success, no matter how nifty their controller is. Both systems may have high initial price points but they are clearly interested in selling as many systems as possible and will definitely get these systems to a point that they will sell, no matter how much they lose. Spftware sales is where they will find their profit, also the new online hubs and shops and sales of things like new levels and t-shirts will be pure profit, compensating for any loss.

Anyone seen the price of DVD's lately, they are dirt cheap compared to a few years ago. Previously viewd titles are sometimes as low as 3 for $10 around here (EBGames). Blu-Ray or HD-DVD (or other), will replace DVD over the next few years (remember VHS? put your DVD's oin the same closet or attic). HDTV's will in the not to distant future be the only TV's available, most stores are 75%+ HDTV already, you can get a HDTV CRT under $500 now, they are almost to the price point of Standard Defintion TV's ov several years ago, with inflation it's probably even. You may have friends refusing to pay for a HDTV but they are just in denial. Most people spend more time in front of thei TV's then in their car, yet they'll dish out hundreds a month just to impress others with their new car...

I see a console war comparable to Genesis (Xbox360), vs PS3 (SNES) approaching (Revolution = TG16), and most people here probably have a SNES a Gensis and many a TG-16.

Trebuken

P.S. - People need to stop being in denial over HDTV, your just plain wrong. Watch your favorite sport on a DLP set with 5.1 surround sound and a six-pack of your favorite beverage, or go to your local Best Buy and watch someone playing Forza on a 53" set with a gaming chair and steering wheel set up in front of it...if this does prove anything to you, try a shrink...it's really that obvious...

[JJNova]

...go to your local Best Buy and watch someone playing Forza on a 53" set with a gaming chair and steering wheel set up in front of it...

Anyone, playing anything, on a 53" Television, impresses me. HD or not.

[smokehouse]

I could be wrong here but I think Sony is making major mistakes here. Fist off leaving the PS2 on the market as their premier system for aver 6 years is a deadly mistake. Hell, the SNES wasn’t even out that long and Nintendo was hammered for not having the N64 out sooner. Second, if you look at what the PS3 is supposed to do, the price is going to be high. I fully expect Sony to market the PS3 as a media center, not a console. By doing this they can fetch a higher price (say $999) and compare it to a PC, not a gaming system. With the long list of features this thing has, there is no way they are coming out with it at anything less than $500. I simply cannot believe how much of a cluster F this whole thing is. For once I believe MS has the right idea. Bring out a fucking system that plays games, do it in a timely manner and at a reasonable cost. Neither Sony nor Nintendo can seem to figure that out. At CES we got a fully functional 360, a mock-up PS3 and a completely fake “Revolution” full of pinball parts. I have watched the major console releases for years and never have I seen such a messed up ordeal. This is truly an embarrassing time for the industry.


As for the HD thing, face it, it’s coming. I’ve had a HD set for years now and I’m not upper middle class. You can pick up a decent HD 16:9 set for low $$ at Wal Mart for crying out loud. DVD has been out since 1998, it’s time to move on. VHS was simply put, a dinosaur. It was in need of replacement years before DVD crept out. Hell, the cassette was replaced in the late 80’s by CD, why were we still watching a cassette format in 1997? If it weren’t for Blu Ray, I’d say that HD DVD (coming out this fall, NOT late 2006) would be where the industry is going. But thanks to Sony pushing another proprietary piece of equipment, there’s going to be a possible format war.

Simply put, it’s the industry that’s bringing things to a halt. Movie houses are too busy trying to stop piracy so they keep coming out with new “better” formats to replace the ones they hadn’t even released yet. Sony is procrastinating on the PS3 and Nintendo is resting on the GC for a while. Meanwhile MS seems to have the right idea (Good Lord, I never thought I’d say that). As for us the consumers, were forced to play the PS2 for 6 years and watch a movie format that’s 7 years old. And my coworkers wonder why I like retro gaming. I will never buy another PS2, period. Not for $99, not for $49. Sony can eat my sack.

[TEXASGAMEPLAYER]

opps

[TEXASGAMEPLAYER]

oops