Sony Lost Over $3 Billion To PS3 Cost, Pricing Imbalance

Illustration for article titled Sony Lost Over $3 Billion To PS3 Cost, Pricing Imbalance

Pricing the PlayStation 3 below its production cost caused Sony to lose $2.16 billion in 2007 and $1.16 billion in 2008, the company revealed today.


Sony's fiscal 2008 annual report delineated potential risk factors to its investors, outlining that "the large-scale investment required during the development and introductory period of a new gaming platform may not be fully recovered." The loss figures were provided as an example of the "significant negative impact" introducing a new platform can cause at first.

"In the past, large-scale investment relating to capital expenditures and research and development for the manufacture of key components, including semiconductors supplied for [PlayStation 3] was also recorded within the Electronics segment," the company said.


In order to stay competitive, said Sony, it had to invest large amounts of money in research and development to introduce the PlayStation 3 into the market, and these sorts of expenditures don't always get recouped, especially if a platform "fail[s] to achieve such favorable market penetration... resulting in a significant negative impact on Sony's profitability."

Even if it can recoup its investment, Sony said, it's still possible to have lost large amounts of money on the platform's introductory period, and even a successful PS3 might take a while to replace what it cost to produce. These possible outcomes are currently a risk for the company, Sony said.

Share This Story

Get our newsletter


twesterms 2nd


Actually, my 360 has been getting about the same play as my PS3 lately. Believe me, I'm not biased.

All I'm doing is just looking at the games available and the games I actually want. For my PS3 I have two games: Uncharted and MGS4. I've bought a few more but those are the only two I've actually enjoyed. There's no bias there, I just don't like the PS3 library. It in now way justifies the high price.

As for the other features, it's a gaming machine and that is suppose to be its primary purpose. I do like that it's a great upscaling DVD player but my receiver can do that too and it costs less than the PS3.

As for my other two consoles (since you brought them up) I have about 10 games for both systems I'm likely never to get rid of and a few more rotating slots for each system for games I buy, play, and then sell. Those systems are worth it.

You were at least right about one thing, it's all based on personal opinion in saying a system is good or not. Still, you cannot ignore the PS3 does not have a good library as of right now. To me it's even smaller because I hate Resistance, I'm not a huge fan of Ratchet and Clank, and I hate racing games.