Sony: PS4 Won't Generate Predecessor's Tremendous Losses
Although Sony could be facing the struggle of the weakening Japanese yen, at least the PlayStation 4 isn't in line to suffer the staggering initial losses of its predecessor.
Sony Computer Entertainment CEO Andrew House told Bloomberg that the company is not expecting the PS4 to lose money at the rate the PS3 did when it first launched:
"We will not generate anything like the losses we did for the PlayStation 3."
Between 2007 and 2008, Sony lost over $3.5 billion after the PS3 launched in 2006. CEO Kaz Hirai said the system didn't even become profitable until 2011, which is undoubtedly part of the reason why Sony wanted to produce a cheaper console the whole way 'round. The problem with the PS3 is that, as CFO Masaru Kato said, Sony spend "hundreds of millions" designing the chip set and "billions" on semiconductor fabrication. The tech just wasn't easily available so the company paid through the nose.
On the other hand, the PS4 uses off-the-shelf PC components and a simpler, more straightforward architecture. As a result, the total investment is much lower and as such, Sony shouldn't have to wait five years for the system to be profitable. Said Kato:
"At the core, we are taking off-the-shelf technology available and we are putting our proprietary technology around that core chipset. The amount of investment is much, much smaller. I cannot give you the absolute amount."
I think Sony got a little carried away after being so far ahead of the competition during the PS2 era...
8/9/2013 11:03:57 AM Ben Dutka