Gord comments on PS2 profits

Post #101,837

5/14/03 11:38:18 AM

[link|http://www.actsofgord.com/Proclamations/chapter02.html|The Legend vs. The Myths!]

Unlike Sega and MS, Sony is an R&D hardware company. They make a lot of things. In designing up the PS2, they spent a lot of cash. Then they spent a hell of a lot more cash to build things like the chip foundries to produce the chips for the PS2.

In the end, before the first PS2 rolled off the production line for consumers, Sony had spent $2 billion! TWO BILLION!

Then we look at Sony's stock report for Oct-Dec 2000, and there is an interesting little blurb. It said that had Sony been able to meet demand with another 1 million PS2 units, they would have pocketed $175 million in profits. $175 million divided by one million consoles equals $175 per console profit.

Now, that is a bit high. This assumed that the average consumer continues to buy four games per console (so around $24 in royalties), and 2 accessories (about $30 in profit total). That reduces the $175 to about $120. Sony is making $120 profit per system.

[link|http://www.actsofgord.com/index.html|Acts of Gord] is an interesting site.

Darrell Spice, Jr.                      [link|http://www.spiceware.org/cgi-bin/spa.pl?album=./Artistic%20Overpass|Artistic Overpass]\n[link|http://www.spiceware.org/|SpiceWare] - We don't do Windows, it's too much of a chore

Post #101,896

by Andrew Grygus

5/14/03 5:12:20 PM

See, I was right . .

Making a profit is a lot less loss than Microsoft's.

[link|http://www.aaxnet.com|AAx]

Post #102,009

by static

5/15/03 7:50:53 AM

That would be it.

That or something essentially the same. It probably was Gord, now that I think of it. He's a funny guy.

Back when the PS2 was a certainty but not out yet, I read a story in a games mag about how SCEI made and sold the original PlayStation as a bit of an experiment. They had *no* help from Sony Corporate, but that was deliberate: Sony Corporate was *very* interested in how it would do but wanted it to succeed without big momma's deep pockets. Or something like that.

So, came time to consider an upgrade and Sony Corporate said to SCEI, "You run it, we fund it."

Wade.

Is it enough to love
Is it enough to breathe
Somebody rip my heart out
And leave me here to bleed

Is it enough to die
Somebody save my life
I'd rather be Anything but Ordinary
Please

-- "Anything but Ordinary" by Avril Lavigne.

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