more price cuts on the way from sony

[joeorc]

Sony Cuts PlayStation 3 Price, Aims to Double Sales (Update1)

By Michael White
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Playstation 3s in Columbus, Ohio

July 9 (Bloomberg) -- Sony Corp., the world's biggest game- console maker, cut the price of the PlayStation 3 in the U.S. by $100, or 17 percent, after sales trailed Nintendo Co.'s Wii and Microsoft Corp.'s Xbox 360.

A PlayStation with a 60-gigabyte hard drive will sell for $499 starting today, helping double U.S. sales, Jack Tretton, head of Tokyo-based Sony's U.S. games unit, said in an interview. A new 80-gigabyte model will go on sale in August for $599.

The price cut may help reduce losses at Sony's PlayStation unit as production costs fall, and will target customers of Microsoft's Xbox 360 Elite model, which carries a $479 tag, analysts said. Nintendo's Wii, the top-selling console at $249, probably won't be affected.

``The price cut is unlikely to help the company dramatically expand its market share,'' Seiichiro Iwamoto, who helps oversee the equivalent of $809 million at Mizuho Asset Management Co. in Tokyo. ``There is still a large price gap.''

Sony said in May that higher sales and lower production costs will help reduce losses at the game division by almost 80 percent this fiscal year to 50 billion yen ($405 million) after a record loss. President Ryoji Chubachi said as recently as July 6 the company had no plans to cut PlayStation 3 prices.

``The price cut should take more away from Microsoft,'' said Richard Doherty, an analyst at the research firm Envisioneering Group in Seaford, New York. ``A lot of sales that would have gone to the Xbox Elite will go to PlayStation.''

E3 Games Show

Sony made its announcement one day before the opening of the Electronic Entertainment Expo, or E3, conference in Santa Monica, California, where console makers and game publishers announce new products for the coming year.

The conference opens tomorrow night with a press briefing by Redmond, Washington-based Microsoft. Kyoto-based Nintendo and Sony have scheduled events for the following day.

Sony will also lower the price of the PlayStation 3 in Canada to C$549, a C$110 discount, for the 60-gigabyte model.

``There are no plans for any other price cuts in other region at this time,'' David Karraker, a spokesman for Sony Computer Entertainment America Inc., said by telephone today.

Shares of Sony fell 0.2 percent to 6,530 yen as of 2 p.m. in Tokyo, after declining as much as 1.2 percent today. Its American depositary receipts, each equal to one ordinary share, rose 1.5 percent to $53.14 on July 6 in New York Stock Exchange composite trading. They have gained 24 percent this year.

Sales Forecast

Microsoft may respond by announcing a cut of $50 to $100 in the Elite's price at the conference, said Michael Pachter, an analyst at Wedbush Morgan Securities in Los Angeles.

``It pretty much forces Microsoft to cut,'' Pachter said.

Last week, Microsoft said it will introduce the Elite in October in Japan for 47,800 yen ($390) to help gain market share.

``We constantly assess market dynamics,'' Darren Huston, president of Microsoft K.K., said today at a news conference in Tokyo. ``We have very competitive pricing'' in Japan, he said.

Sony's sales increase probably will be closer to 50 percent than the doubling Tretton forecasts, Pachter said. At $499, the price of a 20-gigabyte model that's being discontinued, PlayStation 3 still is costly, especially when Wii is available for half the price and the PlayStation 2 sells for $129, he said.

Sony will cut prices further as production costs continue to drop, Pachter said.

``Five hundred dollars isn't going to get anyone excited,'' he said. ``It's good as a signal if nothing else.''

U.S. Sales

U.S. consumers have purchased 1.38 million PlayStation 3s since it was introduced in November. That compares with 2.84 million Wii players, which reached stores the same month. Microsoft, which introduced Xbox 360 a year earlier, has had sales of 5.5 million, according to Port Washington, New York- based NPD Group Inc., which tracks sales.

Sony can cut prices because the company has fixed production problems with a diode used in the PlayStation 3's Blu-ray disk player, said Tretton, who is based in Foster City, California. He declined to discuss costs for the console.

Clearing up the trouble made PlayStation 3 profitable several months ago, giving the company room to cut prices, analyst Doherty said. Microsoft still loses money on each Xbox 360 it sells, he said.

``Any price cut they try to make puts them more into the red,'' Doherty said.

In addition to a larger hard drive, the new PlayStation 3 model will also come with the racing game ``MotorStorm,'' Tretton said.

To contact the reporter on this story: Michael White in Los Angeles at mwhite8@bloomberg.net .

well that explains this...
notice the date:

Mar 15, 2007
Sharp readies blue laser for mass production
The lasers will not come cheap: the quoted sample price is ¥50,000 ($430). However, that price should drop once Sharp’s overall production of blue-violet lasers is scaled up to 250,000
units per month.
http://optics.org/cws/article/industry/27333

now SONY's cost per Diode:
once again look at the date:
April 23, 2007
STRENGTHENING BLUE-VIOLET DIODE PRODUCTION CAPACITY AND BUSINESS

Blue-violet laser diode for BD player
900 Yen ($8.00) per diode

i guess We know where this is ends...BLU-RAY the NEW REPLACEMENT OF THE DVD STANDARD BECAUSE OF THE BDA and the playstation 3.....


PS: DO NOT FORGET YOUR (5) FREE BLU-RAY MOVIES TO GO ALONG WITH THAT NEW PLAYSTATION 3 OR OTHER blu-ray player

http://www.bluraysavings.com/Summer_...Order_Form.pdf