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PSP manufacturing costs $350 higher then those ~$200???
- Thread starter McFly
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Because the media's beating down their door for information? These Sony conferences were going on worldwide simultaneously afaik, repeating the company plans to the world media (it wasn't PSP or region centric)... what's wrong with Sony Germany passing along information to the press?Mrbob said:
jarrod said:
How many times has hardware pricing by announced for another region by a different subsidary? Especially when it comes to Sony and they seem to treat each region of the world self sufficient. The announcement of the PSP price is a pretty big deal. How could anyone but Kutarugi announce it? That's why I'm doubtful about this whole story. I need something more substantial than hearsay. Do you have a link to this pic?
Looks like the story is true:
http://www.computerandvideogames.co...eogames.com/news/news_story.php(que)id=110025
But reading that is even more interesting. In some ways I think Sony purposefully started listing high prices to keep Nintendo off guard, and then able to shock them when they decided to announce the real price.
http://www.computerandvideogames.co...eogames.com/news/news_story.php(que)id=110025
But reading that is even more interesting. In some ways I think Sony purposefully started listing high prices to keep Nintendo off guard, and then able to shock them when they decided to announce the real price.
Well maybe, but the fact that Nintendo surprised with the DS price before a Sony event (where they were said to be revealing PSP launch details) resulting in Sony prempting the event some 17 minutes... I think Sony was surprised. Before that most in the media pegged DS around $200 and Nintendo themselves made comments about it being more expensive than a Game Boy, a premium machine...Mrbob said:
JackFrost2012
Banned
You know, even I don't claim that the PSP costs $550 to make. 
My claim is 50,000 yen, which is about $470. Not that it matters.
My claim is 50,000 yen, which is about $470. Not that it matters. Panajev2001a
GAF's Pleasant Genius
JackFrost2012 said:You know, even I don't claim that the PSP costs $550 to make.
We know
.
DCharlie
And even i am moderately surprised
"But reading that is even more interesting. In some ways I think Sony purposefully started listing high prices to keep Nintendo off guard, and then able to shock them when they decided to announce the real price."
As far as i'm aware :
Sony gave out official statements internally that the cost was to be announced on that day as 33,000
then Nintendo dropped a surprise announcement preceeding the PSP annoucement by 1 hour on everyone
Sony delayed their meeting
they told people to disregard the announcement
in their meeting failed to give out a price at the meeting , with an edgy Kutaragi saying that "oh, you know, we want to see how people react to it at TGS"
I'd say it's stretching it to think that this high price rumour thing has been some deliberate ploy all along to catch Nintendo out.
As mentioned, if this WAS the official price all along, we would have had way more devs on board for sure.
What would have been interesting is if Nintendo hadn't made the announcement. Infact, have Nintendo forced Sony down a path that could lead to Nintendo getting a bit of a spanking? Ironic if it turns out that way.
As far as i'm aware :
Sony gave out official statements internally that the cost was to be announced on that day as 33,000
then Nintendo dropped a surprise announcement preceeding the PSP annoucement by 1 hour on everyone
Sony delayed their meeting
they told people to disregard the announcement
in their meeting failed to give out a price at the meeting , with an edgy Kutaragi saying that "oh, you know, we want to see how people react to it at TGS"
I'd say it's stretching it to think that this high price rumour thing has been some deliberate ploy all along to catch Nintendo out.
As mentioned, if this WAS the official price all along, we would have had way more devs on board for sure.
What would have been interesting is if Nintendo hadn't made the announcement. Infact, have Nintendo forced Sony down a path that could lead to Nintendo getting a bit of a spanking? Ironic if it turns out that way.
Panajev2001a
GAF's Pleasant Genius
I am sorry DCharlie, but I have to blow your cover.sohka88 said:
He is a male Giggolo and he is the top request of SCE's high officers ok ?
After a while they get emotionally attached and they bstart telling him things.
Please DCharlie, I had to tell them the truth... do understand.
JoshuaJSlone
Member
They could sell it for $99 and really screw Nintendo... but even they must have limits.Mrbob said:
i don't buy that nintendo's announcement spurred sony to drop from ¥33,000 to ¥19,800. that's a huge drop, and there was nothing surprising about the ds's price. in that gamespot article, kutaragi is quoted as saying that only a few people at sony were told about the final psp price. i'm not sure that would include anyone at the german branch. perhaps ¥33,000 was just a conservative placeholder price, given to people who didn't need to know.
The devs weren't given the price info either. The first time I heard ~20k Yen tag was literally days before the price was announced.DCharlie said:
Anyway, Deering was talking about higher priced profitable hw many months ago - is the marked up price at 33yen really harder to believe then the proposed astronomical 50kYen manufacture costs?
DCharlie
And even i am moderately surprised
"Anyway, Deering was talking about higher priced profitable hw many months ago - is the marked up price at 33yen really harder to believe then the proposed astronomical 50kYen manufacture costs? "
Out of interest, what do you think is a fair value price for the unit Faf? (or anyone for that matter)
We still have a UMD drive, nice 3rd party screen, awesome or shitty battery (depending on who people believe), WiFi, 2 processors, all fit into a nice compact shell (assuming some design to control overheating etc).
So, what do people think this is costing sony per unit and why?
I'll be absolutely honest, i have ZERO idea how much it should or shouldn't cost, but my gut feeling (well, coupled with what i hear from people closer to the project) is that this isn't a cheap bit of kit.
Also, how much cheaper would a comparable power/functionality unit comprising of cheap off the shelf components cost?
"Anyway, Deering was talking about higher priced profitable hw many months ago - is the marked up price at 33yen really harder to believe then the proposed astronomical 50kYen manufacture costs?"
Deering did mention a price somewhere "nearer to 200 GBP than 300 GBP" - with the price of 249 GBP being hinted at by the press (probably because that was inline with the 48,000 yen rumours going around Japan).
i dunno, does that mean if it's breaking even at 19800 that they were gonna try and f*ck people over for 30,000 yen profit a unit?
Out of interest, what do you think is a fair value price for the unit Faf? (or anyone for that matter)
We still have a UMD drive, nice 3rd party screen, awesome or shitty battery (depending on who people believe), WiFi, 2 processors, all fit into a nice compact shell (assuming some design to control overheating etc).
So, what do people think this is costing sony per unit and why?
I'll be absolutely honest, i have ZERO idea how much it should or shouldn't cost, but my gut feeling (well, coupled with what i hear from people closer to the project) is that this isn't a cheap bit of kit.
Also, how much cheaper would a comparable power/functionality unit comprising of cheap off the shelf components cost?
"Anyway, Deering was talking about higher priced profitable hw many months ago - is the marked up price at 33yen really harder to believe then the proposed astronomical 50kYen manufacture costs?"
Deering did mention a price somewhere "nearer to 200 GBP than 300 GBP" - with the price of 249 GBP being hinted at by the press (probably because that was inline with the 48,000 yen rumours going around Japan).
i dunno, does that mean if it's breaking even at 19800 that they were gonna try and f*ck people over for 30,000 yen profit a unit?
I think they are losing 3 man on each PSP. If that is the case then I'm getting a damn fine bargain. However, I think they are only losing 2.5 man on each since they scaled back the battery. There's probably going to be an extended battery down the line they make us pay for so they make some of their losses back. That and a lot of accessories.
However, I think they are only losing 2.5 man on each since they scaled back the battery. There's probably going to be an extended battery down the line they make us pay for so they make some of their losses back. That and a lot of accessories. One thing I'm trying to figure out. Let's say Sony is losing 250-300 bucks on every unit. So lets say for the sake of argument the cost to produce, manufacture, assemble, and ship the PSP is 450 bucks. They are selling the base backpage at 185 bucks, so that would mean they are losing 265 bucks on each unit. Now, Kutarugi states the PSP hardware will be profitable by March 2006 at the latest. So in the span of 14 months they are going to be able to drop the cost of goods by over 270 bucks per unit? That's why I don't buy the 50,000 yen cost.
Er, the pricing will drop dramatically once screen production is made internal (rather that outsourcing to Sharp)... the Sony/Samasung partnership should make that possible by mid 2005... plus other costs will naturally decrease as time goes by... I really don't see why a $200 PSP couldn't be sold at a profit per unit in March 2006 if everything works according to plan (more production done internally and manufacturing lines get up to speed).Mrbob said:
DCharlie
And even i am moderately surprised
"Now, Kutarugi states the PSP hardware will be profitable by March 2006 at the latest. So in the span of 14 months they are going to be able to drop the cost of goods by over 270 bucks per unit?"
Kuturagi might not be telling the truth? I dunno - after 2 months of PS2 sales, Idea said the PS2 was already profitable (despite 255 billion yen fab costs, R+D, losses on each unit, etc etc)
Kuturagi might not be telling the truth? I dunno - after 2 months of PS2 sales, Idea said the PS2 was already profitable (despite 255 billion yen fab costs, R+D, losses on each unit, etc etc)
Talked to another REALLY GOOD source last week, independent of the other ones I and others on this board have spoken to in recent weeks, who confirmed that the cost to manufacture PSP is hovering around the 50,000 yen range.
I wonder how much it costs to make DS? If they were really willing to go with that 10,000 price, then surely it can't be TOO expensive? Maybe around the actual cost? 15,000? 18,000?
I wonder how much it costs to make DS? If they were really willing to go with that 10,000 price, then surely it can't be TOO expensive? Maybe around the actual cost? 15,000? 18,000?
seismologist
Banned
It sounds like DS really threw a wrench into Sony's PSP plan.
There's no way they could have planned to lose that kind of money up front.
There's no way they could have planned to lose that kind of money up front.
Crazymoogle
Member
john tv said:
I've heard lower.
WordofGod said:
You think they could enter a virtual monopoly and be competitive without losing money at first? Playstation 1 also lost money when it was introduced.
There's pretty much two ways to become successful against a virtual monopoly. The long term method is to bring out cheap products and eventually build up enough brand recognition before you unleash a product that is both competitive or superior in price and features. This however, just takes too long. Or... you could jump into the pool guns a'blazing and bleed against the established monopoly hoping to attract a large enough volume of customers to sustain you till you break even, while raising your product from zero to hero. This unfortunately is the approach Sony has to take. The number of developers/publishers is almost 50/50. Number of games. ditto. However, the hardware is superior at a marginal price difference. I feel they will be successful in the long term due to this.
Sorry for the run on paragraph.
I seem to remember reading an article about this recently... they could have been sued were they not making all the parts themselves - i.e. if it's obvious that the cost of the parts used is way greater than the retail cost of the machine. But since they make 90% of the machine themselves, there's no way to prove it.WordofGod said:
DCharlie
And even i am moderately surprised
"I seem to remember reading an article about this recently... they could have been sued were they not making all the parts themselves - i.e. if it's obvious that the cost of the parts used is way greater than the retail cost of the machine. But since they make 90% of the machine themselves, there's no way to prove it."
wouldn't that have opened MS up to a lawsuit though?
wouldn't that have opened MS up to a lawsuit though?
JackFrost2012
Banned
Jonnyram said:
Yeah, remember when Kaz said "the reason Sony can offer the PSP for this price is because we're manufacturing most of the pieces internally"? (or something like that) I don't think he meant "because it's so much more productive and cost-effective." I think he meant, "because it's so much more legal to hide the losses in another division."
To be honest, I would be pulling a number out of my ass just like anyone else in this thread that calculates it on their ownDCharlie said:
But comparing with prices of components and other portable machines, the 50k mark just sounds like serious engineering trouble, or someone is being ripped off on outsourced parts - I just don't see any way how this cost could be justified for the machine otherwise.Anyway, so far we have two people with "good source" claiming 50k, and one claiming 20k
From me - the source I trust the most at this moment didn't give me a number, but his response to the 50k was "is this guy high?".
Panajev2001a
GAF's Pleasant Genius
Fafalada and DCharlie: well the solution is that the machine does not really cost 50,000 Yen, but that is the price they are paying for each unit now as the PSP is pushed through the FAB in low volumes.
SCE shipped ~500,000 PlayStation 2 units on launch day, but SCE will ship only 200,000 PSP units on launch day which is less then half as many units.
It is not like it is built of many parts which are off-the-shelf and /or outdated: I have not seen many devices which have such a good screen or such advanced graphics capabilities + a optical medium, a high speed Memory slot, 802.11b WiFi, USB 2.0, etc...
The PSP is a one of a kind device.
Still, I do not think it costs 50,000 Yen to make: I think that cost might be due to initial lower than normal manufacturing volume which would be inline with your source.
SCE shipped ~500,000 PlayStation 2 units on launch day, but SCE will ship only 200,000 PSP units on launch day which is less then half as many units.
It is not like it is built of many parts which are off-the-shelf and /or outdated: I have not seen many devices which have such a good screen or such advanced graphics capabilities + a optical medium, a high speed Memory slot, 802.11b WiFi, USB 2.0, etc...
The PSP is a one of a kind device.
Still, I do not think it costs 50,000 Yen to make: I think that cost might be due to initial lower than normal manufacturing volume which would be inline with your source.
DCharlie
And even i am moderately surprised
"Anyway, so far we have two people with "good source" claiming 50k, and one claiming 20k "
well, to be honest, that "two" figure is a little low.
At current count, i'd say there are about 10 people in our gang alone all hearing the same thing from different places (tech guys, devs, publishers)
Obviously people are gonna trust different sources, but the sources for these are all very very good, so it's a little weird that the same ballpark figure is being banded around by different people.
He he, i guess the Q3/Q4 balance sheet should make for interesting reading, if some one can decipher what costs get moved where then we should be able to figure out which was the right figure.
One thing though, Sonys next line up of products (PSTwo, more HDD recorders, PSP) HAVE to cash bringing hits for them to make their 160 billion yen profits for the year - which they didn't revise down as expected after dropping about 20 billion below their Q2 estimate, so the 6 months should be interesting for Sony at least.
Ah, one final thing, still zero advertisement campaign for the PSP, whilst i can't move for DS adverts and PSTwo adverts. Time to start the assault surely?
"well, to be honest, that "two" figure is a little low.
At current count, i'd say there are about 10 people in our gang alone all hearing the same thing from different places (tech guys, devs, publishers)
Obviously people are gonna trust different sources, but the sources for these are all very very good, so it's a little weird that the same ballpark figure is being banded around by different people.
He he, i guess the Q3/Q4 balance sheet should make for interesting reading, if some one can decipher what costs get moved where then we should be able to figure out which was the right figure.
One thing though, Sonys next line up of products (PSTwo, more HDD recorders, PSP) HAVE to cash bringing hits for them to make their 160 billion yen profits for the year - which they didn't revise down as expected after dropping about 20 billion below their Q2 estimate, so the 6 months should be interesting for Sony at least.
Ah, one final thing, still zero advertisement campaign for the PSP, whilst i can't move for DS adverts and PSTwo adverts. Time to start the assault surely?
I haven't read this entire thread, but I get EE Times delivered to me at work, and there was an article talking about this exact subject. If it hasn't been posted already:
http://www.eetimes.com/showArticle.jhtml?articleID=51201601
http://www.eetimes.com/showArticle.jhtml?articleID=51201601
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