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Stringer: No PS3 Price Cut For Christmas, Wii Isn't Hurting Us
by Eric Caoili
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August 28, 2008
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Sony Chairman and CEO Howard Stringer does not expect to reduce PlayStation 3 prices before Christmas, despite the company now making more money with its software sales than it loses with its hardware.
Speaking with German newspaper website arm Welt Online as part of
a wider interview, Stringer said that company is still at a stage in which it needs to get a grip on PlayStation 3 production costs.
According to an annual filing with the U.S. Securities and Exchange Commission (SEC), the PlayStation 3 has cost Sony a total of $3.3 billion since launch, its losses primarily due to the high manufacture cost of the console, which originally was sold at a loss.
When asked if Sony will ever be able to make that money back, Stringer joked, "Not for as long as I live. It will certainly take some time."
Referring to the Wii, he said that Nintendo may be operating on a superior business model, as he claimed that the company makes most of its money on its hardware profits. He added, however, that despite the Wii's dominating sales, the Nintendo's success hasn't negatively affected Sony: "The Wii is not succeeding at our expense -- it is not hurting us. "
He went onto describe the Wii as a well-made device that captured a new target group, one which he feels that Sony once held with its SingStar karaoke franchise: "Perhaps we neglected to pursue that avenue. PlayStation games are rather designed for those who play a lot. Although it's a different strategy, it pays off.
On the topic of the PlayStation 3's Blu-ray capabilities, Stringer said that there isn't a conflict with Blu-ray discs and online download services, including its own.
According to his estimates, it will be another five to ten years before people start downloading a significant number of high-resolution films with quality comparable to that of a Blu-ray disc.
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I can't stop giggling to myself. Just look at that facial expression. It also looks like he's looking up at the headline and reacting to it.