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On PlayStation's 15th Birthday, Platform Claims 349 Million Consoles Sold
by Leigh Alexander [PC, Console/PC]
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September 9, 2010
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Today, September 9, is the 15th anniversary of the PlayStation; including the original console and its two subsequent editions, the platform has sold 349 million hardware units and over 2 billion software units to date, the company announced today.
In today's Gamasutra feature, Sony Computer Entertainment senior VP of marketing Peter Dille reflects on the system's unusual, disruptive launch: "We sold more than [102 million] PS1s, went on to sell more than 146 million PS2s, put Sega out of the hardware business, established us as a household brand, [and] created a huge profit center for Sony Corporation," he says.
It all started with a bold move: Going maverick with an idea that was originally intended simply as a Nintendo peripheral, and implementing the optical disc technology in which Sony was one of the market leaders at the time.
It started, according to Dille, "several years in advance" of the PlayStation's 1994 Japan launch (it would see a U.S. release in 1995), and he remembers being called into then-Sony CEO Mickey Schulhof's office to learn the plan.
"He called me into his office -- and I never had got a call to Mickey Schulhof's office -- and he asked for my help to develop a press release announcing this thing called the PlayStation, which was going to be a peripheral to the Nintendo," Dille tells us.
That information has since come publicly to light, but as Dille highlights: "What Mickey was doing was in effect, negotiating with Nintendo in the press by saying, 'We're prepared to launch this thing on our own if you don't honor the agreement that we had with you,'" he says. "And I thought it was just fascinating to sort of watch this all go down and see how this high stakes game of poker was being played."
"And when Nintendo made their decision, they put out an announcement with Philips," Dille continues. "This was on the eve of CES, you might remember. At that very moment in time, Mickey and a number of senior executives at Sony, said, 'We're going to launch our own product, and we're going to compete to win.'"
Since then, the PlayStation platform has generated over $63 billion in revenue, according to Sony's announcement today. The company claims the equivalent of 40 percent of the overall video game marketshare in the U.S. to date.
The company will be offering fans several new initiatives in celebration of the brand's anniversary: It'll offer free downloadable static themes on the PlayStation Store, weekly discounts on titles in a "15th anniversary collection" in SCEA territories, and a commemorative PSone ornament in its PlayStation Home virtual environment on PS3.
The full Gamasutra feature interview with Dille provides a fascinating look back on the launch of an iconic brand as it turns 15 years old today.
[UPDATE: A previous version of this story cited a Sony press release that said the PlayStation family of hardware sold 377 million to date. But the company corrected that figure in a statement to Gamasutra, as 349 million units have actually been sold to date.
The discrepancy came from figures for the original PlayStation -- Dille originally stated in the Gamasutra feature interview that the console sold 130 million, but it has actually sold 102 million units. A SCEA rep that apologized for the company's error said that in any case, the 349 million-unit landmark "is clearly still an amazing accomplishment that we are incredibly proud of."]
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Oh well...glad to have them both still around.
I'm just saying it would be interesting to see the other timeline where they did collaborate.
The Nintendo-Sony partnership was never going to work out. In fact, I suspect the CD-ROM was just Nintendo's way of dragging their heels and keeping Sony out of the console market just a little longer. They were always seen as the big N's toughest potential rival. Sony had plans for the videogame market for years...the Playstation would have arrived one way or another.
"$63 billion in revenue, they have barely $1 billion to show for it and shrinking."?
How would that even be possible?
edit: of course this is slightly different to saying that out of 63 billion revenue there is only a billion in profits
How is it disingenuous to throw in the PS2 when the crux of the announcement centered on the entirety of the PS brand? Not to mention that the PS2 has continued to sell very well into this most recent generation which, like it or not, makes it relevant even when discussing the current crop of hardware.
Also, I’d love for you to delineate for all of us in detail how you came up with the notion that Sony has generated 63 billion in revenue with only about a billion in actual profits. And please cite some data or sources that don’t share a close proximity with your ass.
http://gamrconnect.vgchartz.com/thread.php?id=57802&page=1
It's sourced though I'm not sure if the links still work, but Sony's own financial statements are on record for people to peruse somewhere I'm sure.
Sony's Playstation division historical consecutive financials in dollars (had to correct the 2009 exchange rate), each to April 1st of that year:
1996 (93,491,480)
1997 508,270,950
1998 954,197,760
1999 1,073,609,660
2000 693,184,350
2001 (463,129,080)
2002 664,149,150
2003 924,881,130
2004 599,416,860
2005 402,344,400
2006 77,419,800
2007 (1,988,702,000)
2008 (1,092,978,300)
2009 (594,812,000)
Cumulative:
1996 (93,491,480)
1997 414,779,470
1998 1,368,977,230
1999 2,442,586,890
2000 3,135,771,240
2001 2,672,642,160
2002 3,336,791,310
2003 4,261,672,440
2004 4,861,089,300
2005 5,263,433,700
2006 5,340,853,500
2007 3,352,151,500
2008 2,259,173,200
2009 1,664,361,200
2010 (fiscal 2009) is complicated because they bundled the gaming division into the new Network Products and Services division, but they made a loss for the year of $893 million dollars. They also calculated the losses the new Network Products and Services division would have made in fiscal 2008 for comparison and they're near identical (about $939 million).
http://www.sony.net/SonyInfo/IR/financial/fr/09q4_sony.pdf
Considering their description of the gaming portion's business as having reduced sales compared to the prior year, and the division as a whole performing about the same (though there was an article up here at the time proclaiming their successes from the peaks of the belltowers ...http://www.gamasutra.com/view/news/28533/Sony_Closes_Game_Biz_Losses_O n_PS3_Grow
th_While_PSP_Drags.php...), I think it's fair to suggest they lost about the same on games as the year prior. I.E., about $600,000,000, bringing their cumulative total to around a billion dollars. Their most recent quarter was very close to zero, but a loss is still a loss, and still trending down.
If you care to look at the actual pattern of profits and losses, Sony made fair money through PS1, slow at the beginning and quick in the middle. They slowed and lost at the end of the PS1 cycle due to PS2 R&D, but rapidly turned to fairly good profitability. But towards the end of PS2 their financials slowed again in the PS3's R&D and PSP release phases. When the PS3 came out, it was all downhill, with losses so monumental they wiped out the bulk of the cumulative profits. For comparison, the cycling of profits has been both less consistent and smaller than Nintendo's, probably due to their strategy of loss leading early in a generation followed by profits, compared to Nintendo's strategy of profiting from the start, earning big on 1st party, and earning in addition on handhelds, explaining how a company that dominated so strongly can be so hard up.
$63 billion revenue is from the article.
PS, To use your criteria they should also include the PS1, and then to complete that criteria, compare it to all game systems ever sold. Nintendo alone is in the 570 million ballpark, which would push Sony to about 40%, but then Sega and MS did exist, didn't they. If you include PS2 because it's current (which I'd contest), then like I said, one should include the GBA, because it sold well into this most recent generation. Either way, it still doesn't give 40% (though it's hard to work out for US only), so I'm asking, how'd they arrive at this percentage?
How much money they earned selling their HD cameras (needed to make blue-ray movies), blue-ray disc recorders (I mean industrial ones, not the blue-ray-r or whatever it is called), SDKs, HD able movie editing software (like Sony Vegas Pro something...), HDTVs, and so on...
In my view Sony strategy is always about global profit, not division profit, if one division need to dive into losses to make others rise, so be it. This time it was the PS3, to shove blue-ray, HD video, and soon, 3D tech to costumers, making not only them buy end-user products related, but also companies buy production technology from Sony.
We must remember that Sony for example make movies too, themselves...
One clear example of how this cross-division thing exists, is the Bullet physics engine, this engine is open source, and made by one of their employees, but if you look at the list of stuff that use this engine, it include both games and movies, and those that use Sony tech (Bullet is optmized to PS3, and ships with Sony friendly 3D and special FX software, and movies that use it buy lots of stuff from Sony)
Two examples:
GTA4 (game, PS3 is one of the platforms)
2012 (movie, some work on it done by Sony Pictures Imageworks, also this movie was shot using the Panavision Genesis HD cameras, that has parts, like image module and viewfinder manufactured by Sony)
Or a blatant blue-ray and 3D driver, that I've seen being sold alongside PS3 stuff in stores, is the JC's Avatar movie, that was shot using Sony CineAlta cameras.
Or were your assumptions of my misinformations sharing a proximity with your ass?
@ Mauricio
The cross leveraging of technology and historical strategic significance involved in Playstation are certainly powerful factors, and reasons why Sony would not have been well advised to have killed the PS3 3 years ago (though an economic view would certainly support that - Playstation 3's losses are so severe - I'd estimate in the order of $6 billion - that it has very little hope of breaking even over even a 10 year lifespan).
The ultimate financial benefits of these indirect contributions are of course very difficult to calculate, but what we do know is that things haven't gone to plan in this generation, what with much slower than hoped/expected Cell processor, Blu-ray, PS3 and HDTV adoption. The wider legacy of Playstation has certainly been a major positive for Sony, as during much of the PS1 and PS2 era its profits buoyed Sony against the significant losses many of its other divisions were making.
Stringer's appointment practically inverted Sony - excising long established and highly respected divisions while making harsh choices on others - taking a knife to every area, with the exception of Playstation - their proverbial golden goose. As I said, things inverted; while most divisions are now carrying their weight under this new order, Playstation looks to have turned from goose to albatross, and when shareholders are looking at problem areas in a rough economic climate, division performance should not be overlooked because of historical intangible benefits.
Make no mistake, Sony had a plan this generation, more ambitious in many ways than the last two, and it didn't fully work out. PS3 was certainly supposed to be the thin end of a tech+HD wedge, but there's no way they ever intended to loss lead at quite THIS level. While some of those technologies' development costs have been absorbed into the PS3's R&D costs, it still pales in comparison to the ongoing losses. Both the overall financial benefit of these other revenue streams vs the PS3's losses, and inability of these other products to succeed without PS3 are questionable.