Hilarious new Sony PS3 article, "shortages will be completely eased by May" Huh?

[petewhitley]

@petewhitley
There's nothing 'short-sighted' about it. The video game market is a fairly predictable beast by now, and history has shown the PS3 is too damn expensive to succeed, so unless Sony decides to make some hard decisions on how to change course (ex. dropping the price or making a cheaper version of the console), they're going to lose a large chunk of the market to Nintendo and MS. No company makes a profit selling systems, but how much $ is Sony losing per system now... with a $600 system? They've made some rather terrible business moves in the past few years with other products, but I think this time their own hubris has finally caught up to them with the PS3.

As for the PSP, I stick by my comments. All I've been hearing and reading about the past few months has been DS DS DS. The UMD side of the PSP is definitely dead! You want facts? A friend of mine works for Digital Deluxe (the office in Moosic, PA to be exact) - a company that was making UMD-format movies. I say "was" because they dropped support of the format last year due to low sales (i.e. no money in it). And wasn't the fact that the PSP could play movies a major selling point? They offered a handful of movies at launch, so I would tend to think 'yes'.

I don't think you're sticking by your comments at all. You're backtracking from your original comments, in which you claimed the PSP has "gone down in flames". UMD is dead, but the PSP isn't. No one is disputing that fact. You also claimed that Sony needs to stop the PS3 "bleeding ... FAST", as if several months into a console launch means anything long-term. Now you're saying they're going to lose a "large chunk of the market". Which is it? Those are both dramatically different statements, with very different long-term consequences for the industry.

And finally, it's asinine to call me a "diehard Sony fan". I grew up in the age of Atari, Intellivision, and Coleco. The NES raised me after that. I've owned just about every system, and enjoy them all. I'm a fan of "gaming", not companies, and it's ass-backwards for you guys to get excited at the thought of a prominent gaming company failing in the marketplace. I've said this before: it ain't a goddamn competition if you're a real fan of the hobby. It is if you're trying to be some forum cool-guy I suppose ...

[petewhitley]

And wasn't the fact that the PSP could play movies a major selling point? They offered a handful of movies at launch, so I would tend to think 'yes'.

This argument is particularly ridiculous. The PSP still supports video via Memory Stick. Regardless, the sales of the PSP have INCREASED since launch, so whether or not Sony felt UMD movies were a selling point is irrelevant, as consumers are obviously in a post-UMD world purchasing the PSP mainly for gaming. A particular feature being under-utilized means nothing in terms of whether a product is successful or not when that feature was obviously not that important to the grand majority of said product's consumers.

[Griking]

Also, about the price on those systems. Here is what they cost and how much money it is today:

3do = $699.95 (~$950)
CD32 = $399.99 (~$540)
CD-I = about $700 (~$1000)
Neo Geo = $649.99 (~$970)

I'm not saying that I doubt you but what do you base these numbers on?

also, didn't the Atari 2600 debut at $200-$250, the same price as the Wii?

[FantasiaWHT]

Well.. its hard to know the exact value, thats why i used ~, which means aprox. I used a calculator i found online for it. I just wanted to show if you were going to buy a CD-I with todays money back in 1991 you had to use about $1000. Im not sure what you mean with the last thing you said, can you explain it more/different?

Well, your calculations use an inflation rate of around 40% since those systems came out (I realize they didn't all come out at the same time). Inflation isn't even across all sectors of the economy though. Some sectors might grow at a rate of 80% over that time, some might have only grown at 5%.

All this means is that while you can reliable say "The 3DO that cost $700 way back when would cost more in today's dollars," it's misleading to say "Based on the average rate of inflation, that same 3DO is worth $1,000 in today's dollars".

You would need to do some serious research and determine the rate of consumer electronics inflation for each year since a system's release. Or even a more narrow sample (video games) if that would be possible.

[jajaja]

Well, your calculations use an inflation rate of around 40% since those systems came out (I realize they didn't all come out at the same time). Inflation isn't even across all sectors of the economy though. Some sectors might grow at a rate of 80% over that time, some might have only grown at 5%.

All this means is that while you can reliable say "The 3DO that cost $700 way back when would cost more in today's dollars," it's misleading to say "Based on the average rate of inflation, that same 3DO is worth $1,000 in today's dollars".

You would need to do some serious research and determine the rate of consumer electronics inflation for each year since a system's release. Or even a more narrow sample (video games) if that would be possible.

No, because the value of the money is the same. I'm talking if you want to exchange todays money with the money 15 years ago. Back in 1990 $700 was worth the same as $1000 today. That will still be the same no matter what.

I know what you're saying tho. You say that there might be other factors to what a console would cost today compared to back then, which is true. Im not saying that a CD-i would cost $1000 today if it was released today, but if you had to work 150 hours to make $1000 in 1990 you would only have to work 100 hours today to make the same amount if you know what im saying. I'm just talking about the value of the money, nothing else.

[Berserker]

The PS3's aren't selling very well at all, it's definitely a harsh reality for Sony. On the bright side, is the fact that a few huge game releases can change all that very quickly.

It would appear to be a reality Sony is not yet ready to face, judging by these ridiculous press releases coming out lately. It's as if they're saying the sky is green, the sky is green, the sky is green, and hoping for everybody not to walk outside and look up. Motorstorm is an eye-catcher, and I was impressed when I played the demo, but I have my doubts as to how significant an impact its release will really have on bottom-line sales. Sony is going to need a HUGE game to recover from this. Likely several. Will this happen? Only time will tell, but I will say this -- if they believe their own press releases as much as we do, they're probably scrambling to pull out an Ace right this very moment. Madly. And this is what they should be doing.

Also my other wonder is, do we need to supply hard data every time we want to have a compelling discussion? Or must we all be statistical analysts to have a valid opinion? This is nothing but opinion and conjecture based on on-hand facts and personal experience. That doesn't mean it's not worth talking about.

[petewhitley]

Also my other wonder is, do we need to supply hard data every time we want to have a compelling discussion? Or must we all be statistical analysts to have a valid opinion? This is nothing but opinion and conjecture based on on-hand facts and personal experience. That doesn't mean it's not worth talking about.

You don't need hard data to merely discuss gaming. But you do have a responsibility to provide hard data if you're making broad proclamations of sales success/failure, which is unfortunately what quite a few members at DP do when it comes to any system not made by Nintendo or named "Dreamcast".

If someone is going to claim that the PSP is "going down in flames" while NPD research shows that it has since launch been virtually neck-and-neck with the DS in North America, they sure as hell ought to have some reason to make this contradictory claim other than "the Gamestop I work can't give ours away!!1!". It's an insult to our intelligence.

As a working adult, I can afford a variety of gaming systems, and I don't take any joy whatsoever at the thought of one of them dying. A lot of guys around here do. As a life-long gaming fan, I can't understand why these kids are so invested in seeing Sony fail. Sony has brought gaming to the masses with incredible success, and as gamers we should respect that legacy just as much as the legacy of Nintendo. Hot Topic peddles NES t-shirts to hipsters and kids who weren't even alive in '83; apparently it's the "cool" thing to rag on Sony. Pathetic.

[badinsults]

People who use inflation to justify the high cost of the PS3 do not understand economics. Video game consoles typically have a lifespan of 5-6 years, over which period the price of the consoles decrease significantly. So in reality, video game console pricing follows a sawtooth pattern of pricing. Sony has bucked the trend by offering a console that is over $200 more than the typical peak of the sawtooth. On that same token, the price for games has remained almost steady in the past 15 or so years, with only a slight drop in prices in the mid 90s when the advent of cds came about.


So there you go, you see why inflation does not apply to video games.

[jajaja]

People who use inflation to justify the high cost of the PS3 do not understand economics. Video game consoles typically have a lifespan of 5-6 years, over which period the price of the consoles decrease significantly. So in reality, video game console pricing follows a sawtooth pattern of pricing. Sony has bucked the trend by offering a console that is over $200 more than the typical peak of the sawtooth. On that same token, the price for games has remained almost steady in the past 15 or so years, with only a slight drop in prices in the mid 90s when the advent of cds came about.


So there you go, you see why inflation does not apply to video games.

What is there to understand? Point is that you had crazy ass expencive consoles before that were much more expencive than the PS3. PS3 is far from the only console that had high price compared to the competitors. If you had a time machine and had to buy early 90s money, you have to pay more for less. If you want $700 in 1990 money you must pay $1000 of todays money.

Btw, the prices for games have gone down over the years, atleast where i live. The price for PC CD-ROM games is cheaper today. Its about the same pricetag now as it was for 15 years ago, some are even cheaper. And as said, money were worth less before

[jajaja]

People who use inflation to justify the high cost of the PS3 do not understand economics. Video game consoles typically have a lifespan of 5-6 years, over which period the price of the consoles decrease significantly. So in reality, video game console pricing follows a sawtooth pattern of pricing. Sony has bucked the trend by offering a console that is over $200 more than the typical peak of the sawtooth. On that same token, the price for games has remained almost steady in the past 15 or so years, with only a slight drop in prices in the mid 90s when the advent of cds came about.


So there you go, you see why inflation does not apply to video games.

What is there to understand? I dont see anyone who have justified the PS3 price, all i've seen is comparing, where and who justified it? Point is that you had crazy ass expencive consoles before that were much more expencive than the PS3. PS3 is far from the only console that had high price compared to the competitors. If you had a time machine and had to buy early 90s money, you have to pay more for less. If you want $700 in 1990 money you must pay $1000 of todays money.

Btw, the prices for games have gone down over the years, atleast where i live. The price for PC CD-ROM games is cheaper today. Its about the same pricetag now as it was for 15 years ago, some are even cheaper. And as said, money were worth less before

[Mattiekrome]

PS3's are so mainstream though. You can pick one up at pretty much any of the big box stores. I can never recall a time when I walked into a Wal-Mart or K-Mart and checked out the NEO-GEO games. I'm 28 and have yet to see a NEO-GEO in person, and I've been in my fair share of gaming stores. IMO, I would say that the NEO-GEO had a totally different target audience than the PS3, but then again, times have changed ALOT since then.

Now that I think of it, I remember my old bro-in-law buying a 3DO when they first came out, but hell I cant remember where he got it from. I dont recall seeing any 3DO stuff in Wal-Mart either.

[jajaja]

That game companies don't sell consoles for what they're worth, but rather what the consumer expects. This is *not* the norm how most every other company sells their products (ex. you won't see automotive companies selling cars and trucks for less than it cost to make them, and if they do you better believe they're gonna make it up somewhere else, like with next year's model). Console makers make their $ with software, period. They always have, mainly because technology has a nasty habit of becoming obsolete very quickly (and because the console is worthless without software ). As someone else mentioned, the launch price slowly comes down over time, and this is for a number of reasons:

* Cost of manufacturing the console is reduced due to cheaper parts, or via a redesign (consolidating parts, removing parts/features, etc.)
* Company can afford to lower it due to increases profits from software or other areas of their business
* Increased pressure from competitors (i.e. price war, newer systems being introduced, etc.)

True, but i dont think i get my point out the way i mean it. Take i.e Neo Geo, $649 back in 1990. If you only follow the inflation of the money, that would be the same as nearly $1000 today. Of course, as i said earlier, it wouldnt be possible to sell a console for $1000 today. The market and prices of things changes of course.

My dad bought a calculator in Hong Kong in 1974. The pricetag was $125 That was actually very cheap back then compared to the prices back home, today that price is insane. Compared to todays value its almost $500. Selling a calculator today for that price, not gonna happend unless its made of gold. So i know you cant compare the prices today and back then since the market changes.

Therefor, i'm not connecting these prices and saying that the PS3 is cheap, because compared to the competitors, the PS3 price is high, just like Neo Geo's price was high compared to the SNES. I just thought it be fun to see how much the expencive consoles back in the early 90s was compared to todays value

PS3's are so mainstream though. You can pick one up at pretty much any of the big box stores. I can never recall a time when I walked into a Wal-Mart or K-Mart and checked out the NEO-GEO games. I'm 28 and have yet to see a NEO-GEO in person, and I've been in my fair share of gaming stores. IMO, I would say that the NEO-GEO had a totally different target audience than the PS3, but then again, times have changed ALOT since then.

Now that I think of it, I remember my old bro-in-law buying a 3DO when they first came out, but hell I cant remember where he got it from. I dont recall seeing any 3DO stuff in Wal-Mart either.

Good point. I also mention something about this, the consoles like Neo Geo and CD-i was pretty much unknown the general crowd, one factor that made them "fail". Today everyone knows the word Playstation, and that alone is enough to sell a fair share of consoles. "Its a Playstation, is has to be good, i'm buying it"

[badinsults]

It should be noted that inflation doesn't have anything to do with "value for money". It has everything to do with the cost of prices going up to offset manufacturing costs and turn a profit. The fact is, computers and electonics cost less now than they did 20 years ago without taking into account inflation. You also see this fact in the sawtooth pattern of videogame console prices. You can't compare apples and oranges. You can't compare something like the price of gasoline and the price of a video game console. They are completely different things. Inflation is just a general average of price increases across a wide range of products, but that doesn't tell you anything about how much a video game console should cost.

[jajaja]

It does. When the salary goes up, so does the prices. The pricetag on houses today are much bigger than the pricetag 20 years ago, why is that? Because we make more money. If the prices stayed the same and we just got higher and higher paychecks we would buy stuff like crazy. Therefor the prices must also follow.

There are exceptions of course, like PC games and games in generaly (atleast where i live), but you got to look at the bigger picture. No one have compared apples and oranges either, atleast not what i can see About the price on consoles, well.. goes for anything, they take what they can get.

[FantasiaWHT]

I don't know about PC games, but console game prices have definitely gone up

Up until the release of X360 a year and some change ago, prices of games definitely decreased. Look at the 16-bit era. RPG's in particular were usually selling for $70-$80, with some as high as $100 (Phantasy Star IV). Then for two generations, nothing except for collector's editions and some N64 games (which further proves the point about newer technology becoming cheaper) sold for more than $50. If you looked at average new game prices, those decreased on the average as well because of reprints and budget titles.

And jajaja, yes, apples and oranges. Inflation is NOT simply "the value of money". It does not increase evenly across the entire economy. It's an average of all sectors, all goods and services. Houses have increased MUCH more rapidly than the rate of inflation. Gold is almost twice as expensive (~$650 / oz the last time I looked) than it was ten years ago (~$350 / oz). Some things increase much more slowly or even decrease. Consumer electronics decrease rapidly in cost (how much did a DVD player cost 8 years ago?). Food increases much slower than the rate of inflation.

So to recap- you CANNOT just apply the rate of inflation to video games (or any product or service) and claim to know how much something from 15 years ago is "worth" in today's money without knowing the actual rate of inflation for at LEAST the appropriate sector of the economy if you can't get any more specific than that.

If you don't understand that, please go take a basic economics course somewhere before you try to make these arguments.

[jajaja]

So to recap- you CANNOT just apply the rate of inflation to video games (or any product or service) and claim to know how much something from 15 years ago is "worth" in today's money without knowing the actual rate of inflation for at LEAST the appropriate sector of the economy if you can't get any more specific than that.

As i said 50 times now hehe, i know all this. I really dont know how this discussion started, all i did was to compare the value from today and back then, leaving every other factor aside. I know that the marked changes and theres alot of factors thats involved when it comes to prices now and back then. Now im just repeating what i've already said several of times.

That's why you can't say a PS3 would have cost half as much back then, anymore than you can say a VCS would have cost twice as much now. Smart companies wouldn't have done that. It would have been financial suicide. You can adjust the prices about $100 - that's it. And that's only b/c people have slowly become more acceptable of paying that much more. But when a company like 3DO has jumped in and doubled that price, it's been disastrous (for them). And that's exactly what Sony is attempting to do now.

Again i can only repeat myself, i know all this, i even said it myself. Taking the increase in income as the only consideration, nothing else, it would mean that you would have to spit out $1000 of todays money to get a CD-i back in 1991. And the comment about the bigger picture was directed to Evan_G's comment, which was a general thing, not just about video games. You can ask yourself why we make more money today than for 20 years ago. Why not just stay at the same rate? But as you said yourself, the coffee example, the reason why 1 cup of coffee is more expencive today is because we make more, so you understood my point there And i said there was expections like games so dont miss that comment.

Again, i dont know how this discussion actually started. Either i'm expressing my points badly or people really dont read what i'm saying. It seems that people got so hung up because i compared the price only and totaly ignored the other things i said, but as i mentioned several of times, i know you cant (read people, read). So i think there is no need to contunie this situation. All thats been said, i know that. All i did was to compare the price back then to now, leaving all other factors aside, since i know prices in the marked changes by other factors too. I cant make it clearer than that.

[scorch56]

Eluding to the statement I made earlier in the thread about "fair trade items"..

Today I was in our local Circuit City with my friend. He was along for the ride.. but I was pricing LCD HDTVs and he was over in the games section.

I rounded the corner of an aisle, and almost tripped over two PS3 boxes just setting on the floor stacked. There was a hand-written sign taped to the top of them that said:

"TODAY ONLY SPECIAL!

Buy an HDTV and get a PS3 for a $100 discount!"

Being a little curious.. I walked up to a sales clerk and asked him, "Can you guys do that? Sell a PS3 for $499?"

The kid looked at me and winked and said, "No we can't.. but we CAN take $100 of the price of the HDTV."

.. looks like it's already beginning.

When we got back to my friend's house I told him with amusement what I saw. He replied, "That's nothing.. I saw six boxed PS3s sitting on the shelf over in the games section."

[cyberfluxor]

The reason a cup of coffee is more is due to basic economic inflation on a market place. When it comes to technology, it always falls and the high-end goods usually enter around the same price, unless the company sinks more research and better "current" technology into it. The hardware in your NES is really worth a few bucks tops today, but it's the function that's worth the dollars. Back when it was released that manufacturing, production and research costs reached the few hundred a unit cost.

In addition though, the real reason these game systems are costing too damn much is because they're making them into something they weren't supposed to be for. When you pack all these new options like WiFi, browsers, hard drives, USB ports, ect then of course their cost goes up. Truely for all the junk they've packed into it $600 isn't too bad, but for a general gamer who just wants to play a game it's overdone.

[RPG_Fanatic]

As a working adult i buy all the systems so i don't really care who wins or loses (i like my 360 the best right now though) it seems funny that every one wants Sony to lose because they've been on top for so long. Every one says their so cocky but remember Nintendo was the same way back with the NES and SNES when they were on top, people started to hate Nintendo with their cocky attitude and censorship of games alot of people started chanting SEGA!!! and wanting Sega to win the console war back in the day.

[heybtbm]

Nintendo was the same way back with the NES and SNES when they were on top, people started to hate Nintendo with their cocky attitude and censorship of games alot of people started chanting SEGA!!!

And the result of Nintendo's arrogance was the worst mainstream console in history...the Nintendo 64. You would think Sony would have used this example as a lesson to be learned...

"Those who cannot learn from history are doomed to repeat it."

Even in the video game business.