Sony expects to make an approximate $60 loss per $399 unit sold

[Mavrick]

Sony Seem to have done extremely well keeping costs down this gen, arguably the only reason they are taking a $60 hit is the "business decission" to go from 4gb RAM to 8gb GDDR5 RAM.

Regardless, that loss will be wiped out when you take in to account almost everyone that buys the console will buy at least one game and a lot of people will buy a PS+ sub, easily bringing home that $60 loss and maybe even pushing it into profit.

It's hard to imagine that back in 2006 Sony was losing $241.35 on every $599 console sold and $306.85 on every $499 console sold.

PS3 was costing Sony $840.35 to build in 2006, compared to the PS4 cost today at what I would assume is around $460.

PlayStation 4 hardware will make a loss at launch, but Sony expects to immediately recoup the costs when a typical user also buys a PlayStation Plus subscription and at least one launch game.

Sony Japan executive Masayasu Ito made the comment to Eurogamer today in an interview at the company's Tokyo headquarters.

Eurogamer has heard from well-placed sources that Sony expects to make an approximate $60 loss per $399 unit sold. When presented with the figure, Ito denied it - but only because the company expects a typical user to buy a console with these other items.

Ito would not be drawn on whether more than one launch title would need to be bought before the whole equation resulted in Sony making money, just that the company expected to turn a profit on an average user's initial purchase.

The purchase of one launch title and a Plus subscription would indeed total close to, if not more than, the $60 mark.

But even without the purchase of these items, PlayStation 4 will incur a profit at a sooner point than PlayStation 3, Ito concluded.

Nintendo made a similar comment prior to the launch of Wii U - its console was also sold at a loss but would become profitable with the purchase of a single game.

Last month Sony Computer Entertainment boss Andrew House said he expected PlayStation 4 launch-related losses to come in below those of the PlayStation 3.

Chief financial officer Masaru Kato added at the time that because the PS4 features PC-like architecture - as opposed to the custom components featured inside the PS3 - the cost of production is "much, much smaller".

http://www.eurogamer.net/articles/20...loss-at-launch

[Nerdkiller likes BD]

Good to know that Sony have learnt their lesson when it comes to this.

I wonder how much the Xbone costs to build, though.

[Mavrick]

Originally Posted by Nerdkiller likes BD

Good to know that Sony have learnt their lesson when it comes to this.

I wonder how much the Xbone costs to build, though.

MS are said to be breaking even with the XBone so $500 would be the build cost, I wonder how much they could have saved by not making kinect a requirement.

[NARMAK]

Sony are probably making more of a break-even on the consoles in the EU territories imo. The prices usually yield a nice little profit for them here and then kind of subsidize the lower pricing that occurs in North America.

Still, very nice to see Sony are on top form again, and they are on the mark with content, pricing and hardware specification. They haven't taken a mis-step yet and I can only hope it continues for the entirety of the generation and into the next 8 lol.

[Hayabusa85]

They did the smart and right thing from a business standpoint. But I can't help but be greedy and wish they would have been the Sony of old that would have pumped a lot more money and power into the hardware at the cost of taking a bigger loss on the system plus a higher initial cost to the consumer. Worked out fine for them in the end with the PS3. Both systems are pretty underwhelming specs wise TBH.

[MerrickG]

Originally Posted by Hayabusa85

They did the smart and right thing from a business standpoint. But I can't help but be greedy and wish they would have been the Sony of old that would have pumped a lot more money and power into the hardware at the cost of taking a bigger loss on the system plus a higher initial cost to the consumer. Worked out fine for them in the end with the PS3. Both systems are pretty underwhelming specs wise TBH.

I couldn't disagree more. The tech powering the PS4 is plenty powerful.
If they had gone with even more powerful tech the costs would have risen dramatically and they would have gotten diminishing returns on performance/graphics.

What they put together easily gives the best bang for the buck.

[Icemage]

Originally Posted by MerrickG

I couldn't disagree more. The tech powering the PS4 is plenty powerful.
If they had gone with even more powerful tech the costs would have risen dramatically and they would have gotten diminishing returns on performance/graphics.

What they put together easily gives the best bang for the buck.

Agreed. PS4 is in the perfect sweet spot of computational power this time around.

Besides, this coming generation won't really be about computing power (not that any previous gen has been either, really). Online services, social sharing/exploration, extra input integration (Kinect, Move, Remote Play, Wii U tablet, Xbox Smartglass, Oculus Rift, mobile support apps, etc.) will probably be much bigger factors.

Hardware power can help all of these, of course, but it's foolish to want more expensive cutting edge hardware than what we're already getting. The more expensive the hardware is, the slower it hits mass market, and the fewer games can be created in the ecosystem because of limited install bases.

If you're really desperate for the Best of the Best, just buy a PC and be done with it.

[Blu Lemmy]

Originally Posted by MerrickG

I couldn't disagree more. The tech powering the PS4 is plenty powerful.
If they had gone with even more powerful tech the costs would have risen dramatically and they would have gotten diminishing returns on performance/graphics.

What they put together easily gives the best bang for the buck.

Totally agree with that, they have hit the sweet spot

[Derb]

Originally Posted by MerrickG

I couldn't disagree more. The tech powering the PS4 is plenty powerful.
If they had gone with even more powerful tech the costs would have risen dramatically and they would have gotten diminishing returns on performance/graphics.

What they put together easily gives the best bang for the buck.

I would of payed $100 more for PS4 for backwards compatibility.

[Terjyn]

Originally Posted by Derb

I would of payed $100 more for PS4 for backwards compatibility.

I am sure you would have. I also am almost positive that it would cost more (probably a lot more) than 100$ to put the necessary components in to the PS4 to make it happen.

No way is the PS4 going to software emulate the Cell.

[4K display]

More powerful hardware would've meant more heating/cooling/noise issues among other things, I too think they have struck a good balance.
I really wish they could have slapped a SSD in there but I guess that'll have to wait till PS5 when cost and size is a more realistic ROI.

[Hayabusa85]

All generation changes are about power. Otherwise there is no need for them. The only exception was the Wii which was a fad that sold to non-gamers. The Wii U was the reality check. More power would have meant more cost to Sony and Microsoft but again that didn't hurt Sony in the end last gen so no reason it would have hurt them this gen.

With a PC architecture more power would not have meant more cost to game development. More power doesn't have to mean another cell processor that is a nightmare to develop for. That is the kind of thing that added to PS3 development costs. And it would not have been hard to take advantage of the extra power when we already have multiple engines these underwhelming specs can't handle. Battlefield isn't even a demanding game and the reports are that the console versions are still medium at best on Xbone and PS4. That is pathetic. There is no excuse for these next gen systems to not be able to handle the equivalent of max settings on PC for games like Battlefield 4 which are not all that demanding. When aging PC's can max those out and new consoles can handle medium at best it is sad. And it wouldn't have even taken an expensive investment to at least get to that level at the minimum. It also isn't any surprise we have yet to see an Unreal Engine 4 game when Epic made it no secret they were not happy with the final specs and stated that only PC could handle UE4 as it was designed at that time. No doubt they are now having to redesign a lesser engine which actually means more cost for them.

As for a higher cost yeah it would have made people less likely to buy a next gen system right away but reality is 95% of the gaming market is slow to transition anyway. So that changes nothing. And a minimal upgrade won't make people transition any faster than a higher cost since they won't see the point if they are not getting a substantial upgrade. Especially in the first year+ where most games will still be on the last gen systems.

As for heating and noise that wouldn't have to be an issue. Poor ventilation has been the problem with consoles more than anything. Even then pretty much only with the 360. Optical drives more than anything have been a problem on consoles. Anyway, a Titan runs cooler than my weaker AMD GPU and makes less fan noise based on the stress test results. And these console GPU's have more in common with my AMD GPU than they do the Titan which destroys them. More power alone doesn't = more heat. Proper casing even on the PC will always play the biggest role in heating as long as you are not trying to overload a motherboard or something stupid. A fan is a fan. It is going to be the same regardless of power.

As for going PC it doesn't solve anything. Most games on PC are lazy efforts that get held back by the consoles since the developers can't be bothered going beyond that. Hell there were games like Madden and NHL where they were so lazy the PC was still getting the old Xbox/PS2 gen engines. Even the resolution advantage has been erased lately with so many games running letterboxed at 1080p or even worse 720p. Sadly something else the consoles are also showing to be too weak to handle in the case of 1080p.

Can't think of a gen where consoles have been this severely underpowered right from the start and not just over the course of the generation where PC's keep advancing. It is a depressing turn to the industry to me. I will get both consoles at launch because I don't want to miss out on the games but will always be disappointed this gen hasn't seen a large jump forward.

I will always want the Tim Taylor approach to next gen systems And yes I will admit it is easier for me to want that when cost wouldn't be an issue but they would drop in price eventually

The only good thing I can say about the underpowered systems is that they shouldn't have to downgrade them this time at least. Have never been able to love a PS3 as much as I did my launch system before it died. Slower, no backwards compatibility and I was even one of the few that used the media card reader. And you want to talk noise? The downgraded PS3 is louder than the launch PS3.

[MerrickG]

Originally Posted by Hayabusa85

All generation changes are about power. Otherwise there is no need for them. The only exception was the Wii which was a fad that sold to non-gamers. The Wii U was the reality check. More power would have meant more cost to Sony and Microsoft but again that didn't hurt Sony in the end last gen so no reason it would have hurt them this gen.

Except for the fact that Sony was in a much more lucrative position back then and could afford to take a much bigger loss.

Originally Posted by Hayabusa85

With a PC architecture more power would not have meant more cost to game development. More power doesn't have to mean another cell processor that is a nightmare to develop for. That is the kind of thing that added to PS3 development costs. And it would not have been hard to take advantage of the extra power when we already have multiple engines these underwhelming specs can't handle. Battlefield isn't even a demanding game and the reports are that the console versions are still medium at best on Xbone and PS4. That is pathetic. There is no excuse for these next gen systems to not be able to handle the equivalent of max settings on PC for games like Battlefield 4 which are not all that demanding. When aging PC's can max those out and new consoles can handle medium at best it is sad. And it wouldn't have even taken an expensive investment to at least get to that level at the minimum. It also isn't any surprise we have yet to see an Unreal Engine 4 game when Epic made it no secret they were not happy with the final specs and stated that only PC could handle UE4 as it was designed at that time. No doubt they are now having to redesign a lesser engine which actually means more cost for them.

Where did Epic say this? Battlefield 4 is a launch title. Its a given that launch titles are not going to be able to take advantage of what a system offers.

Originally Posted by Hayabusa85

As for a higher cost yeah it would have made people less likely to buy a next gen system right away but reality is 95% of the gaming market is slow to transition anyway. So that changes nothing. And a minimal upgrade won't make people transition any faster than a higher cost since they won't see the point if they are not getting a substantial upgrade. Especially in the first year+ where most games will still be on the last gen systems.

WTF are you talking about?!! The PS4 is a SIGNIFICANT upgrade over the PS3. Sony is NOT in a financial position to make a massively expensive machine and take a huge loss on it. here are some reasons why its not worth it.

a) the only games that would take advantage of the system fully would be first party software. Third party games would be developed with Xb1's limitations in mind. There are not near enough first party exclusives to justify the significant investment.

b)Again, anything beyond the specs that we get is going to give you diminishing returns. Not worth it.

Originally Posted by Hayabusa85

As for heating and noise that wouldn't have to be an issue. Poor ventilation has been the problem with consoles more than anything. Even then pretty much only with the 360. Optical drives more than anything have been a problem on consoles. Anyway, a Titan runs cooler than my weaker AMD GPU and makes less fan noise based on the stress test results. And these console GPU's have more in common with my AMD GPU than they do the Titan which destroys them. More power alone doesn't = more heat. Proper casing even on the PC will always play the biggest role in heating as long as you are not trying to overload a motherboard or something stupid. A fan is a fan. It is going to be the same regardless of power.

Who are YOU to say that heating wouldn't have been an issue? There is a reason that the GPU/CPUs in the PS4 are supposedly being underclocked.

Originally Posted by Hayabusa85

As for going PC it doesn't solve anything. Most games on PC are lazy efforts that get held back by the consoles since the developers can't be bothered going beyond that. Hell there were games like Madden and NHL where they were so lazy the PC was still getting the old Xbox/PS2 gen engines. Even the resolution advantage has been erased lately with so many games running letterboxed at 1080p or even worse 720p. Sadly something else the consoles are also showing to be too weak to handle in the case of 1080p.

Can't think of a gen where consoles have been this severely underpowered right from the start and not just over the course of the generation where PC's keep advancing. It is a depressing turn to the industry to me. I will get both consoles at launch because I don't want to miss out on the games but will always be disappointed this gen hasn't seen a large jump forward.

I will always want the Tim Taylor approach to next gen systems And yes I will admit it is easier for me to want that when cost wouldn't be an issue but they would drop in price eventually

The only good thing I can say about the underpowered systems is that they shouldn't have to downgrade them this time at least. Have never been able to love a PS3 as much as I did my launch system before it died. Slower, no backwards compatibility and I was even one of the few that used the media card reader. And you want to talk noise? The downgraded PS3 is louder than the launch PS3.

This is just sad. The PS4 is pretty darn powerful. If you put together a PC using similar specs many games would run quite well.

[Hayabusa85]

Except for the fact that Sony was in a much more lucrative position back then and could afford to take a much bigger loss.

Sony have been in debt for ages and have constantly been bailed out by the Japanese government. So they were not in a good position back then either. They will never be in a good position again in their existence. And they could have made a much more powerful system that wouldn't have cost what the PS3 did. Most of the PS3 cost came from the jump to Blu-ray actually. And the Cell processor was just an all around mess. Costly and too hard to develop for. The cost of the PS Eye that most people won't bother with alone could have helped fund a better system.

Where did Epic say this? Battlefield 4 is a launch title. Its a given that launch titles are not going to be able to take advantage of what a system offers.

http://www.examiner.com/article/epic...owerful-enough

The launch excuse with Battlefield doesn't work at all. PS4 in particular was designed to be similar to a PC so it is easy to develop for. This is no a case like the PS3 where developers can't figure out how the system works leading to a poor port. If the current consoles can't handle the equivalent of the max settings at 1080p/60fps with a game that isn't even considered a demanding game on PC then it is one thing and one thing only. They are too weak to handle anything more.

WTF are you talking about?!! The PS4 is a SIGNIFICANT upgrade over the PS3. Sony is NOT in a financial position to make a massively expensive machine and take a huge loss on it. here are some reasons why its not worth it.

a) the only games that would take advantage of the system fully would be first party software. Third party games would be developed with Xb1's limitations in mind. There are not near enough first party exclusives to justify the significant investment.

b)Again, anything beyond the specs that we get is going to give you diminishing returns. Not worth it.

Compared to the jump between the GC and Wii it is significant but no by the normal standard it isn't significant at all. This is by far the most pathetic generation jump in the history of this industry. And when this gen dragged on years longer than the standard if anything this should have been the biggest leap. There has never been a generation leap where so much of the media are admitting these systems don't have a wow factor as are gamers that got their hands on them at events. Such as Mavrick posting about after the EuroGamer event (Think that is what it was called). But more concerning there has never been a generation leap where so many developers are coming out and admitting they are letdown by how weak the systems are. The latest being Crytek admitting they had no choice but to massively downgrade Ryse because they were using PC for the development and underestimated just how weak the Xbone actually is now that it is time to get it running on the actual hardware.

A) Both systems are pathetically underpowered so both should have been more powerful. Problem solved.

But because of the PC architecture games are being developed on PC first and not the consoles this gen. So while they are having to be massively downgraded from PC the PS4 versions can take advantage of the extra power it has now. So if it had even more power and it was just Microsoft being useless then yes that advantage could have been taken advantage of even more. NFS, Battlefield 4 and Watch Dogs being some of the games confirmed to be better on PS4 with the extra power it does have already. But even then big downgrades from PC which is why we are seeing PC footage of all of those (Or next to nothing with NFS).

Plus at the end of the day exclusives are what set you apart so even if only exclusives took advantage of power it isn't exactly a bad thing.

B) The industry has been struggling the last few years with analysts, publishers and developers blaming it on this gen dragging on too long. Systems being so weak at launch doesn't help the long term prospects of this gen let alone the letdown at launch. And more and more people are starting to lean toward PC because this coming gen is such a letdown so doesn't seem like a great financial decision to me to drive people where you will make no money. Hell Sony would be smarter to drive people to the Xbone than the PC even. Valve are starting to get into the position that they will be the real winner of this gen.

Who are YOU to say that heating wouldn't have been an issue? There is a reason that the GPU/CPUs in the PS4 are supposedly being underclocked.

Common sense could be making me give Microsoft and Sony too much credit for not being incompetent. But common sense without ruling in their incompetent says DUH. Again the Titan is the most powerful GPU right now and slaughters these systems. Yet it runs cooler and makes less noise than a lot of weaker GPU's. More power doesn't = more heat. Poor ventilation and incompetence = more heat.

This is just sad. The PS4 is pretty darn powerful. If you put together a PC using similar specs many games would run quite well.

If you put together a PC with similar specs you would have done it ages ago. My PC is three years old and it is more powerful than both systems. And that is a PC I am looking to replace next year because I am feeling it is outdated and too weak too. And that is coming from me still being able to max out games at 1920x1200 but seeing some dips below 60FPS every now and then. More than these systems are capable of and I feel the need to upgrade. If I put it at 720p like most games are still going to be this gen I would be well over 100FPS in any games let alone having to limit stuff to 30FPS.

Shame you can't upgrade consoles and we will be stuck were severely under powered hardware for who knows how long. One can only hope the five year cycle returns.

Also when it comes down to it one needs to look no further than the Wii U as a lesson on why weak financially smart hardware isn't good. You need to sell systems for something to be financially smart. None of these systems are going to do anything that makes them a fad with the non-gamers like the Wii. This gen very well could kill the gaming industry actually.

[Mavrick]

If a huge improvement in graphics is what people are looking for in next gen consoles then prepare to be disappointed at launch.

[Blu Lemmy]

Originally Posted by Mavrick

If a huge improvement in graphics is what people are looking for in next gen consoles then prepare to be disappointed at launch.

We only played Alpha build stuff Mav, it still needs to be optimized and some of the stuff I saw was outstanding

Really you are looking at 2-3 years into the cycle before stuff starts getting really good

[Mavrick]

Originally Posted by Blu Lemmy

We only played Alpha build stuff Mav, it still needs to be optimized and some of the stuff I saw was outstanding

Really you are looking at 2-3 years into the cycle before stuff starts getting really good

Oh I know that. You can see the improvements over current gen but no matter how good the games get I don't think there will be the same leap as we saw in previous generations.

Lighting and textures were the stand out features, gameplay wise I couldn't see anything we don't already have. Although Forza did impress me with the AI cars making mistakes where as cars in gt etc always seem to follow a set path.

[Blu Lemmy]

That I do agree with, it certainly isn't going to be a leap like before and I think people realize that, epecially the informed amoung us, but it will be impressive nonetheless

[Maximus]

Originally Posted by Mavrick

If a huge improvement in graphics is what people are looking for in next gen consoles then prepare to be disappointed at launch.

It's going to be a repeat of the PS2. It will be sold out for months with little to no good software, but eventually the games will come and it will become one of the greatest consoles of all time. The initial buzz for the PS4 is the same as the PS2 and pre-orders are absolutely insane. I wouldn't be surprised if Sony got to the end of March with 6m units sold and the end of 2014 with 16-18m sold.

The PS4 is incredibly easy to develop for and small teams can take advantage of a fixed specification and millions of potential buyers and it will also support AAA development.

The PS2 was very, very disappointing at launch though, I remember sitting there just playing the blue demo disc over and over.

[MikeCL]

I knew it's not going to be a Ps1 to Ps2 jump, the thing is the hardware and shaders used for the graphics. and more memory for sure, glad they did not skimp on that.

only 46 days left for the U.S. launch!