PS3 Cost? How about $900 USD

February 18th, 2006 · No Comments

Sony will lose a bundle on the launch on the PS3, according to Merrill Lynch. The estimated componant cost is 900 USD, the best-guess sticker price for the PS3 is 399.99 USD. A loss to Sony of 500 USD per console. Microsoft is losing 350 USD per console, Nintendo historically sells consoles for a profit from day one - though no-one knows how much that will be on the Revolution as yet.

For a little perspective, lets take a look at a similar example in the same industry, the Xbox 360. Earlier estimates suggested that the Xbox 360 costs $715 to make which means Microsoft is willing to lose around $350 per console sale based on a $299-399 retail price. If Sony wants to remain competitive with Microsoft (does it?) and rival the Xbox 360’s price, it could lose as much as $600-700 on each PS3. Finally, it’s worth noting that these companies have money to lose: Microsoft’s revenue reached $38 billion in 2006, whilst Sony topped $70 billion in 2004.

Just how much are Sony and Microsoft willing to sink into the console war? The answer: Whatever it takes. Nintendo, just hurry up and release the Revolution already.

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