PS3 in last place

With 60% sales boost, PS3 is hotter but still in "last place"

No surprise considering the PS3 is the most expensive console out there.

I was thinking the same thing...

There is some merit to devoting a processor system to a gaming platform, but at what price point does it become disadvantageous to do so?

I wonder if the powers at Sony are asking themselves that very question.

Just about every console ever has specially designed their CPU. I think it's all the other things Sony included, like a Blue Ray DVD reader.

Ducc - you are right the useless (IMO) Blue-ray drive is why the price is about $100 more than the Xbox360 which you can also buy the HD-DVD drive seperate.

If it's just the components and not a profiteering aganda, then I would expect PS3 prices to drop in time. Historically, that's not exactly been the case.

BluRay drives cost about .50 more to produce that a conventional CD. The rest is engineering recoup, marketing costs, and the uncertainty that accompanies it- which jacks up the profit margin.

Well the PS3 prices have droped. The price of the PS3 isn't exactly $100 more than the Xbox 360 there's 3 Xbox 360 and PS3 models the cheapist PS3 costs the same as the most expensive Xbox 360 model. If your talking about the 20 gig PS3 vs the Xbox 360 Pro/Premium than yes it is 100$ more. And both of those systems are sold at a lost while the Wii isn't. The fact that you have to pay $180 for the Xbox 360 HD player makes the PS3 coming with a Blu-Ray drive a better deal.

You've been reading too much marketing garbage!

The wholesale value of an average PS3 is about $60, give or take (about 11-12% of retail). Which means it actually cost a little more than half that to build.

If there's any loss at all, it's probably that 1st and 2nd production run sales haven't offset the marketing blitz costs promoting the product initially. My guess is that manufacturing and engineering costs have already been recovered. The initial sellout did that.

It's somewhat sobering to think that slightly less than half of what your paying for that system is providing the TV commercials and full-page magazine ads- which are telling you to go buy it.

A Playstation 3 is sold for $500 or $600. If you add up the cost of the componets in the system it comes to around $800. Granted the cost of the hardware may have went down but I still think they're loseing money on it.
PlayStation 3 Offers Supercomputer Performance at PC Pricing
PlayStation 3 costs $800, sez Merrill Lynch mob

If they were paying the retail prices the links quoted, they would.

But they're not. Not anywhere NEAR that.

What you're reading is marketing gimmickry. The prices are 'funny numbers'. It's made to make consumers think they're getting a good deal. And, if you tried to build a PS3 yourself with retail off-the-shelf parts in single-piece quantities, you would indeed spend about $200 more. OEM's can't afford that.

The rationale is simple. Think about it for a minute.... A $200 loss per PS3 times what- a million units? Add marketing costs- a 30 sec TV spot runs from 50-300K. A full page magazine ad about 6-10K. They've probably spent in excess of sevaral million just in promotions. Add another mil in manufacturing tool-up and engineering costs. Another couple mil in project salaries. Add shipping costs and retail marketing/distribution overhead. Best Buy, Circuit City and other retailers aren't selling these things for free...

With an estimated profitable product life of about two years- with the majority of it in the first 6-8 months, do you REALLY think they'd start off THAT far in the hole?

Sony is nowhere near that benevolent!