Pachterdamus: More PS price drops predicted

[PhiberOpticks]

Originally Posted by Gamasutra
Industry News

August 7, 2007

Pachter: PS2 Price Drop In 2007, PS3 To Drop For GTA IV In his latest notes wrapping up news for July and early August, Wedbush Morgan analyst Michael Pachter has predicted that the PS2 could see a price cut in anticipation of the holidays, but that a drop in the PS3's price might be delayed to early 2008 alongside GTA IV and Metal Gear Solid 4.

"We continue to expect higher average console prices to be an impediment to rapid sell-through of hardware," said Pachter, "and we expect cycle-to-cycle declines of 10% or more for hardware sales to persist through the end of summer 2007."

Following Sony's $100 price cut on its 60 gig model PS3, and the recently announced drop on all models of Xbox 360, Pachter thinks it might be too soon to see Sony dropping the PS3's price yet again, but adds that "a price cut for the PS2 is possible," adding that "any hardware price reduction could serve as a catalyst for sales growth later in the year."

However, with Grand Theft Auto IV now delayed to spring of next year, "we do expect Sony to be in a position to cut the price of the PS3 in early 2008," said Pachter, when it and console exclusive Metal Gear Solid 4 will be launching.
POSTED: 08.37AM PST, 08/07/07 - Brandon Boyer - LINK

I see no reason to even pay attention to the PS2 at this point. It would simply hurt Sony more in the long run. But another PS3 price-cut would be nice.

[Ziero]

Re: Pachterdamus: More PS price drops predicted

PS2 is still a great system with an expansive library of games and highly popular in Japan. As is it has similar graphics to the Wii so it's not that far behind the 'next-gen' stuff, and a fun game is a fun game regardless. They want the PS2 to last as long as possible to help make up for the obvious losses from the PS3. Once the PS3 starts taking off on it's own, which really hasn't happened yet with no good exclusives out, they'll most likely lessen their focus on the PS2.

Even back when the PS2 was new, the PS1 was still pumping out new things. I guess they decided what worked then will work now.

[PhiberOpticks]

Re: Pachterdamus: More PS price drops predicted

PS2 is still a great system with an expansive library of games and highly popular in Japan. As is it has similar graphics to the Wii so it's not that far behind the 'next-gen' stuff, and a fun game is a fun game regardless. They want the PS2 to last as long as possible to help make up for the obvious losses from the PS3. Once the PS3 starts taking off on it's own, which really hasn't happened yet with no good exclusives out, they'll most likely lessen their focus on the PS2.

Sony's simply hurting themselves by not pushing the new format. The PS3 can play PS2 games. If people are buying PS2s and not PS3s, they're not buying PS3 games. If a PS2 sells and a PS3 doesn't. They're making 150 bucks, but they're losing a potential 350 on top of the loss due to manufacturing costs.

[Icemage]

Re: Pachterdamus: More PS price drops predicted

I don't know why Michael Pachter gets so much attention. He hasn't been terribly accurate in his tech predictions in the past.

I sincerely doubt a price cut on the PS2 is in the cards. Sony actually makes money on the PS2, and it's already half the price of its nearest competitor now (Nintendo Wii) since the GameCube and Xbox are officially terminated.

I think PS3 price cut is definitely in the works; Sony would have to be completely insane to leave the 80GB SKU at $599. I think we may see the 60GB drop to $399 before the end of year (since it's discontinued), and the 80GB will fall to $499 most likely for the holidays.

Realistically, Sony actually needs the price points to be $399 to be competitive, but if what I'm hearing from my contacts inside Sony is true, that's not very likely unless they do what Microsoft suggested a few weeks ago at E3 and release a stripped-down PS3 SKU for $399.


Icemage

[PhiberOpticks]

Re: Pachterdamus: More PS price drops predicted

Realistically, Sony actually needs the price points to be $399 to be competitive, but if what I'm hearing from my contacts inside Sony is true, that's not very likely unless they do what Microsoft suggested a few weeks ago at E3 and release a stripped-down PS3 SKU for $399.

And it would work too. Perhaps they could do the same as Microsoft and Nintendo and have Sixaxis controllers standard with AA batteries. And they could sell rechargeable battery packs and chargers separately. They should have scrapped the tiltboard from the start. But oh well.

[Pai Pai Master]

Re: Pachterdamus: More PS price drops predicted

Sony needs to keep pushing PS2 because for a while longer, they won't be profiting on PS3 hardware sales, except for the 80GB MotorStorm Pack, which will probably only be available for a month or two. Most people who buy a PS2 at this point aren't looking to buy a next-gen console any time soon, so why not continue to make nice profits on PS2 hardware? PS2 sales are still fairly strong stateside but they'll need a price drop to stay relevant in competition with the Wii and 360, as the next-generation of consoles will take precedence this holiday.

I doubt we'll see the 60GB hit $399 this year because it will probably be gone within the next month or two. Sony says they expect to sell out of them by the fall and at the rate they're selling, it's highly likely. The most probable situation is that the 60GB and 80GB bundles will sell out and we'll be left with an 80GB standalone unit for $499. The next price cut will likely come next year around the time Sony's big guns like LittleBigPlanet and Killzone 2 are being readied alongside third party major titles like Grand Theft Auto IV and Metal Gear Solid 4, as Pachter predicts.

[Icemage]

Re: Pachterdamus: More PS price drops predicted

My current theory with the 80GB SKU is that Sony doesn't want the 60GB units to sit. They'll leave it at $599 as long as 60GB availability persists, but it'll drop to $499 the moment the 60GBs are gone.

Why? Because Sony wants to clear the 60GB units out of the pipeline and not leave them sitting on shelves. If the 80GB units were priced similarly, people wouldn't buy the 60GBs.

Even so, they really, really need to revive the 20GB unit, or something equivalent. This is the holiday season coming up; they're going to be missing the boat completely for a year if they don't take the reins and win some market share this Christmas, and I don't think they can do that at a $499 price point.


Icemage

[Pai Pai Master]

Re: Pachterdamus: More PS price drops predicted

It's obvious they'll shift the 80GB unit to $499 once the 60GB stock is depleted, but I don't see anything else coming this year, other than the chance of a Starter Pack similar to what Europe currently has, with MotorStorm, Resistance and an extra controller packed in for $599.

[little ninja]

Re: Pachterdamus: More PS price drops predicted

My current theory with the 80GB SKU is that Sony doesn't want the 60GB units to sit. They'll leave it at $599 as long as 60GB availability persists, but it'll drop to $499 the moment the 60GBs are gone.
Why? Because Sony wants to clear the 60GB units out of the pipeline and not leave them sitting on shelves. If the 80GB units were priced similarly, people wouldn't buy the 60GBs.
Even so, they really, really need to revive the 20GB unit, or something equivalent. This is the holiday season coming up; they're going to be missing the boat completely for a year if they don't take the reins and win some market share this Christmas, and I don't think they can do that at a $499 price point.
Icemage

Well the 360 elite dropped its price down to 449.99. So as it sits thats still better then the 60 an 80 gig Ps3. Which are 499 and 599. So if someone looks at the price tag. Then most likely i think the 360 and the 150 dollar cheaper price will hurt sony.

[Pai Pai Master]

Re: Pachterdamus: More PS price drops predicted

I certainly don't think the $449 Elite is a better purchase than the $499 PS3, but that's just me and I'm crazy. Regardless, Microsoft will have the price advantage for another year at the very least.

[PhiberOpticks]

Re: Pachterdamus: More PS price drops predicted

The 360 would still be a better purchase just for the games. But the only difference between the 360 Pro and Elite is that the Elite has HDMI output and a separate TOSLINK and RCA output cable.

[little ninja]

Re: Pachterdamus: More PS price drops predicted

I certainly don't think the $449 Elite is a better purchase than the $499 PS3, but that's just me and I'm crazy. Regardless, Microsoft will have the price advantage for another year at the very least.

That just depends on when you were to buy it. If you were to buy a Ps3 and only the 80gig is available. Thats 600 dollars. Vs a 120gig 360 Elite for 450 dollars. Then you figure that they are pretty much getting the same titles for the most part. I think those players who haven't bought the next gen console will more likely lean towards the 360. Of course thats just me speculating with the theory "More bang for your buck"

The 360 would still be a better purchase just for the games. But the only difference between the 360 Pro and Elite is that the Elite has HDMI output and a separate TOSLINK and RCA output cable.

It has a 120gig vs a 20gig as well. Not to mention any Elite made from July and on will have the new safety measures against the RRoD. While with the other 2 xbox systems you will more likely to buy one made prior to the new upgrades.

[PhiberOpticks]

Re: Pachterdamus: More PS price drops predicted

The PS3 price drop was not a price drop in actuality. It's more of a clearance sale. But I see no reason to do this. It does nothing for Sony, except give them a reason to keep a high price for a product whose manufacturing costs are steadily dropping.

[Pai Pai Master]

Re: Pachterdamus: More PS price drops predicted

Because the 80GB model costs much less to manufacture. They're trying to get rid of all their 60GB models as quickly as possible so they can push out shipments of the 80GB model.

[PhiberOpticks]

Re: Pachterdamus: More PS price drops predicted

How does a costlier hard drive equate to a cheaper system, exactly?