PS4 sold at a loss

[Demon_Skeith]

Sony will lose money on each piece of PlayStation 4 hardware sold at launch, the company has revealed, but it's positioned itself to mitigate that loss once with some common purchases.

The news was revealed by Sony Japan's Masayasu Ito in an interview with Eurogamer. He went on to point out that the other purchases it anticipates the average consumer will make with a PS4 at launch -- such as a PlayStation Plus membership and a game -- will allow it to recover its losses. Reiterating what Sony's Andrew House told Reuters recently, Ito also noted that, even if these purchases are not made, the PlayStation 4 will begin generating a profit more quickly than the PlayStation 3. Due to factors like the development of the Cell processor, Sony's ability to turn a profit on PS3 was hindered in the console's first several years of availability.

Earlier this year, Sony indicated it didn't expect the PS4 launch to lose a great deal of money. Chief financial officer Masaru Kato said in May, "Unlike PS3, we are not planning a major loss to be incurred with the launch of PS4." As reported in August, though, the currency rate of the Japanese yen could present problems for Sony.

Sony is taking steps to encourage gamers to move from PlayStation 3 to PlayStation 4 at or shortly after launch, doing things like offering a heavily discounted price on a handful of PS4 games to owners of the PS3 versions for a limited time.

PlayStation 4 launches on November 15 in North America, November 29 in Europe, and February 22, 2014 in Japan.

source

no brainer this happen, but I'm glad they didn't take the $600 gamble again.

 

[froggyboy604]

Indeed, it is no surprise, but I wonder where is Sony losing its money. I guest Sony would spend a lot of money on advertising the PS4 on TV, Newspapers, the internet, and radio which can get very expensive to buy ads during the holiday season, and big events like Christmas, Black Friday, and the Superbowl.

It probably won't be good if more casual gamers bought the PS4, and don't subscribe to PSN Plus, and mostly borrow games from friends and family, buy used games, and rent games from Redbox, Blockbuster and other rental places which could make it harder for Sony to recover it losses quicker since Sony doesn't earn much money when someone rents or buy used games, and a lot of people still don't subscribe to paid online gaming services.