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Sony Doesn't Expect Profit From Vita For Three Years

As if you didn't see this one coming.

The price for the two PlayStation Vita models was revealed during Sony's E3 press conference, and most agree that both price tags are at least somewhat reasonable. However, considering the technology involved and Sony's history with the PlayStation brand, it should come as no surprise to learn that Sony will initially sell the Vita at a loss. In a Japanese interview with Reuters, Sony boss Kaz Hirai said the company expects to make a profit on the new piece of hardware "within three years." He also hopes it'll be more popular than the PSP in the long run; to date, Sony's current portable has shipped 70 million units worldwide. And by the way, although it was reported that the Vita will be available "this year," that still only applies to Japan.

That doesn't mean North America won't get it this year; it just means the launch in other territories might be in early 2012. As for the rest of it...of course they'll sell it at a loss to start with. They always do that.

Tags: ps vita, playstation vita, sony, psp

6/8/2011 2:55:18 PM Ben Dutka

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Comments (44 posts)

Highlander
Wednesday, June 08, 2011 @ 3:07:10 PM
Reply

Hmmm... considering the tech inside the shell, it almost has to sell at a loss. Look at how much an Xeperia Play sells for *without* a phone contract. There can be no doubt that the device will pack a punch and sell at a loss initially.

As for the launch. I'm not so pessimistic. There were a decent number of pretty much production samples on stage for the demos. they all looked like production units, not engineering samples or prototypes. Perhaps they are manufacturing samples, but they looked seriously ready to go. If that's the case and it's a holiday 2012 launch. Then I think Sony may mirror the PS3 launch and drop them in Japan and NA at the same time, and then Europe and the rest of the world a little later. That said, it depends on production capacity.

Seriously though the units demo'd onstage looked like production units, I think they're already being manufactured and put in shippers.

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Fane1024
Wednesday, June 08, 2011 @ 10:46:30 PM

pretty sure High meant "holiday 2011"

I agree. Judging from the E3 hardware, I'm betting production has begun (first test runs at least) and Sony is hoping to have enough units ready for a worldwide holiday launch, but isn't 100% sure they will, so they're being cagey.


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Highlander
Thursday, June 09, 2011 @ 1:29:09 AM

You're right. Holiday 2011....too many holiday releases, and too much haste typing.

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Qubex
Thursday, June 09, 2011 @ 2:38:06 AM

But if they are selling them at a loss, will the form factor change over time? Will it feel cheaper like the PSP3000 did when it was released, compared to the older models?

If I get a Vita later on, will I be punished quality wise for not having got one upon release? Will features, ports and general configuration change to save costs?

Q!

"play.experience.enjoy"

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Fane1024
Thursday, June 09, 2011 @ 5:25:55 AM

Unlike the PS3, later PSPs (excepting maybe the PSP-go) had more features than the 1000.

So, for example, if there isn't a video out on the launch PSV (as has been rumored though the E3 onstage units clearly had one), I'd bet one will be added on later models.



Last edited by Fane1024 on 6/9/2011 5:27:17 AM

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Highlander
Thursday, June 09, 2011 @ 12:06:43 PM

Fane a lot of things that have been rumored and subsequently denied can also be done entirely through software. But I think you're right about the video out - it will happen. the units on stage though I think were plugged up to power so that their screen ran in the highest brightness setting for the cameras.

But, given the hardware in the device, I think we'll see the feature set improve over time. for example, Sony says in one of their FAQ that it doesn't function as a PS3 controller. Except that it has BlueTooth, and it wouldn't take more than a software update to add the functionality. So I think we'll see things added over time.

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Dead_Starr
Wednesday, June 08, 2011 @ 3:07:49 PM
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:( poor Sony

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Ole_Gunner
Wednesday, June 08, 2011 @ 3:08:30 PM
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I think that's a necessary hit Sony have to take and kudos for them having the guts to do it.

The Vita has to compete with the 3DS on price and I think we'll se a good uptake from consumers towards on not only price point but a more robust software offering at launch

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jimmyhandsome
Wednesday, June 08, 2011 @ 3:11:31 PM
Reply

I think Sony realizes that an initial loss in the short-term will benefit them long term. I applaud them from learning from their mistake with the PS3 launch.

Last edited by jimmyhandsome on 6/8/2011 3:11:48 PM

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Highlander
Wednesday, June 08, 2011 @ 3:17:20 PM

I'm confused, which mistake relating to selling at a loss would that be? The PS3 sold at a loss for nearly three years.

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jimmyhandsome
Wednesday, June 08, 2011 @ 3:26:13 PM

Pricing the PS3 out of the range that most could afford AND significantly higher than that of the competition?

I wasn't aware that the PS3 sold at a loss for 3 years, though. My comment was more in line with pricing their product closer to the competition.

It seems to me, that pricing the Vita the same as the 3DS, Sony 1) is being very competitive in reclaiming handheld market share and 2) with the far superior technology over the 3DS, seems to make Nintendo look foolish in the process.

Whereas with pricing the PS3 at $600, you will not get as much sympathy from the public if you take a loss. Especially when people could buy a 360 or Wii for $100-300 cheaper.

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Highlander
Wednesday, June 08, 2011 @ 4:10:51 PM

Yeah, at launch the PS3 sold for fully $300 less than it cost to make. so that $600 PS3 actually cost more or less $900 to make. You can see why they don't want to repeat that, but even so they are selling Vita at an initial loss.

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GuyverLT
Wednesday, June 08, 2011 @ 3:17:04 PM
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It's unfortunate, but eh! it happens to the best of em,. They just got to role with the punches and have faith in they're overall product.

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Highlander
Wednesday, June 08, 2011 @ 3:18:46 PM

I have faith in it. I'd rather have a PS Vita than a dozen 3DSs at this point. think about it, Starfox 64 on the 3DS vs *any* Vita launch title. It's not even a fair fight.

Vita wins baby...

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GuyverLT
Wednesday, June 08, 2011 @ 3:33:07 PM

I faith in it too it's just something I didn't have with the PSP, the PSVita however will be my 1st handheld since the gameboy color.

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Highlander
Wednesday, June 08, 2011 @ 4:11:25 PM

I think that with the Vita, the launch games just look too good to fail.

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GuyverLT
Wednesday, June 08, 2011 @ 4:14:49 PM

That is something we definitely can both agree with.

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Highlander
Wednesday, June 08, 2011 @ 4:42:32 PM

There's always things to agree on...the more the merrier.

Last edited by Highlander on 6/8/2011 4:42:47 PM

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Clamedeus
Wednesday, June 08, 2011 @ 8:56:39 PM

The Graphics for the Vita are damn good, my mouth literally dropped to the floor on how the visuals are of the machine, it's impressive for a handheld device.

Last edited by Clamedeus on 6/8/2011 8:58:57 PM

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GuyverLT
Wednesday, June 08, 2011 @ 9:26:16 PM

I know... that's why I'm getting one.

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Clamedeus
Wednesday, June 08, 2011 @ 11:56:40 PM

I know as well. :P I'm also going to try and get one. I can't wait though it looks awesome, I'm wondering how it's going to work with the PS3 and such and the features it will have, or be implemented.

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Qubex
Thursday, June 09, 2011 @ 2:52:55 AM

Guyver... reality is Sony are hoping to make the initial losses back on sale of the games. This can only mean one thing I think, a high cost to the games... they will not be much cheaper than fully fledged PS3 game titles...

Vita games will probably cost 2/3rds the price of PS3 games, which isn't very cheap...

Q!

"play.experience.enjoy"

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Sancho
Thursday, June 09, 2011 @ 6:38:03 AM

Qubex you probably wont see this now but PSP games are already 2/3 of full priced PS3 games. $40 for new PSP games generally so I wouldn't be mad at that price for a PSV game.

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Highlander
Thursday, June 09, 2011 @ 12:09:17 PM

Qubex,

Ironically games costing 2/3 of the price of a PS3 game will cost $39.99 (2/3 of $60 = $40) which is exactly the price range of PSP titles. PSP titles have been $39.99 since launch, so even if you only factor a low level of inflation, they're cheaper in real terms now than they were at the PSP launch. That also means that in real terms Vita games (if they cost 2/3 of what a PS3 game costs the consumer), they'll be cheaper still...

;)

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faraga
Wednesday, June 08, 2011 @ 3:33:43 PM
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How about the RAM cut? Did that go through in the end?

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vicious54
Wednesday, June 08, 2011 @ 3:36:03 PM
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Great move by Sony since they have to compete with other handhelds at that same price point. I know a lot of my friends were on the fence thinking it would be a $400 product at the least.

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Arvis
Wednesday, June 08, 2011 @ 4:02:54 PM
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I think a $250 launch price is actually really good! Didn't everyone kind of assume it would be quite a bit higher than that?

-Arvis

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Highlander
Wednesday, June 08, 2011 @ 4:12:40 PM

Yep, when Kaz said $249, IO think my wife thought I was having some kind of attack. LOL! I was trying to figure out how to afford one, now I'm wondering if she'll want one too.

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Fane1024
Wednesday, June 08, 2011 @ 10:53:47 PM

Oooo... It's the Big One... You hear that, Elizabeth... I'm comin' to join you!

(I suspect Highlander will get the reference, though he may have only seen the UK version.)



Last edited by Fane1024 on 6/8/2011 10:54:35 PM

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Highlander
Thursday, June 09, 2011 @ 1:31:48 AM

Sanford & Son - I lived in the States in the 70's, I remember watching it then. It was a rare example where the original was different enough that both shows were better than each other...Steptoe & Son had it's moment's too...

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Qubex
Thursday, June 09, 2011 @ 2:53:49 AM

Highlander... where do you live now?

Q!

"play.experience.enjoy"

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Fane1024
Thursday, June 09, 2011 @ 5:33:34 AM

Maybe I shouldn't answer for him, but I think he said he's in the South-East, Tennessee or Carolina IIRC.

His profile says Tokyo, but that's wishful thinking.


Last edited by Fane1024 on 6/9/2011 5:34:56 AM

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Highlander
Thursday, June 09, 2011 @ 12:09:56 PM

Tennessee, and yes Tokyo is wishful thinking. I will get there one day, even if it's only for a visit.

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sha4dowknight05
Wednesday, June 08, 2011 @ 5:37:53 PM
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Awe man, at least consumers will be happy about the pricing.

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oONewcloudOo
Wednesday, June 08, 2011 @ 6:24:40 PM
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That weird I was watching an interview and sony said they are going to make a profit

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GuernicaReborn
Wednesday, June 08, 2011 @ 6:50:58 PM
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Good to know. Well, good for me anyway. Sony, not so much.

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Doppel
Wednesday, June 08, 2011 @ 7:39:51 PM
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Is it region-free though??

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AaronDude
Wednesday, June 08, 2011 @ 8:41:49 PM
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I don't know if it means it will actually be a loss or Sony just doesn't expect to make much. I wouldn't pay more than 250 bucks for a handheld anyway. I am going to pick this up when it's released, all the features are just really cool. They probably shouldn't sell it to me though if they think they're gonna take a loss because I will probably only buy two or three games for it in it's lifespan. I guess it all depends on the quality of the RPGs.

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Highlander
Wednesday, June 08, 2011 @ 9:59:26 PM

Yeah, well you're probably not one of the target audience then. Given the technology inside that shell, $250 is a very low price. Next time you doubt that, consider that it's 2-4 times faster than the best phones and pads around today, and they cost $500-$800 when purchased without a wireless contract.

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Qubex
Thursday, June 09, 2011 @ 2:56:17 AM

AaronDude... only 2 or 3 games, over a life span of 5 to 7 years. I don't know mate, I mean Sony want to tempt you to spend more.

Once it is in your hands you will be tempted to spend more anyway when you can easily buy software on PSN and transfer. There will PS1 and PSP RPG titles you could download and play on the Vita...

I honestly think you will end up spending more than you think...

Q!

"play.experience.enjoy"

Last edited by Qubex on 6/9/2011 2:56:37 AM

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Bloodedge
Wednesday, June 08, 2011 @ 9:37:46 PM
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The fact that Sony is willing to take a loss on this device shows just how much faith they have in the Vita. It'd be a shame if we didn't reward them.

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___________
Thursday, June 09, 2011 @ 3:30:57 AM
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this begs to differ.
http://www.gamesthirst.com/2011/06/08/ps-vita-will-be-profitable-on-day-one/
typical sony, contradicting themselves AGAIN!
im starting to think no employee has ever met another employee, i mean if i had a nickle for every billionth time a sony employee has come out and said something, then another has come out and contradicted that id be the richest thing in the universe by now!

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Highlander
Thursday, June 09, 2011 @ 12:11:08 PM

Interesting, perhaps Kaz is referring to the return on investment in that Vita will pay for it's own development and move into true profit within 3 years?

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___________
Friday, June 10, 2011 @ 9:41:14 AM

software probably is what hes talking about, i remember him saying development costs are significantly lower for vita, so that should help counteract whatever losses they make hardware wise.
though they definitely will be making losses in hardware sales, thats just how it goes, every company always sells a device at a lower price initially to break into the market.
really disappointed theres going to be no internal memory though, thats just silly!
ok they are trying to lower the cost, but come on is 16GBs of internal memory that expensive?
what memory cards will it support?
i hope its M2, already got 2 16GB sticks so i could use those.
wish it had internal memory though, will get annoying having to carry around your games and sticks for the save files.
hopefully you can copy the game from the flash drives they come on to your memory stick that way you dont have to carry 2 for 1 game.
unless you can save the game where the games stored.
wish it had internal memory though, they should offer one with one without id happily pay a little more for one with memory.
only reason i bought a go instead of a 3000 was exactly that, i dont have to carry all my games with me!

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