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Tretton Discusses Platform Pricing, PS3 Hitting Its Stride
Tretton Discusses Platform Pricing, PS3 Hitting Its Stride
April 5, 2011 | By Eric Caoili

April 5, 2011 | By Eric Caoili
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As the company prepares to launch a PSP successor in the next year, Sony Computer Entertainment America's president and CEO Jack Tretton shared his philosophy on platform pricing and his belief that the PlayStation 3 is just hitting its stride.

"I think when you're buying a platform, when you're buying technology, you're hopefully buying a device you're going to enjoy for many, many years," said Tretton in an interview with Fast Company. He compared the purchasing of a handheld or console game system to other gadgets like the iPod or iPhone.

"People are used to spending several hundreds of dollars to get a portable device. I think in the long run, when you look at that total investment in a platform, the amount of money you spend on the hardware is a relatively small percentage of the total investment."

Though SCEA has warned that production of its upcoming PSP successor, codenamed Next Generation Portable, could be delayed due to damage to its Japanese facilities after last month's earthquake and tsunami, the company is expected to launch the system worldwide within the next year.

The platform holder hasn't announced pricing yet for the NGP, but analysts predict it will be more expensive than its primary rival, the Nintendo 3DS, which debuted in North America last month for $250 -- the same price at which the original PSP and PSP Go launched years ago.

"It's not to say the price of the platform isn't a consideration, but I don't think price makes or kills a platform," said the SCEA boss, speaking about consoles in general and not the NGP specifically. "Something that's lousy, that's very inexpensive, is not going to be successful, and something that's pricey will ultimately find its audience if there's enough value there."

Tretton also told Fast Company that he feels SCEA is "just hitting [its] stride" with the PS3 -- a sentiment he expressed for the PlayStation brand three years ago. He said the financial investment Sony made with the PS3, and the technological innovations of Move and 3D, is something the company will "reap dividends on for many, many years".

"We're not in cruise control mode; we're still in growth mode. Fortunately, it's been steady growth for the last four years, and we anticipate strong growth again in the next fiscal year," said the CEO.


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Comments


Maurício Gomes
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"It's not to say the price of the platform isn't a consideration, but I don't think price makes or kills a platform," said the SCEA boss







I guess he never heard of 3DO and Dreamcast and some others... Or of PS3 itself at launch. (seemly PS3 only got to second place only this year...)

Kevin Patterson
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I agree with you Mauricio.



Most people didn't buy a Dreamcast $199.99 at launch because Sony was promising "Toy Story" Graphics at launch for the PS2, and everyone waited with baited breath for the successor to the PS1. The over promises Sony made worked the first time, not so much for the PS3 with its $599.99 price tag, and the promises of running games at 120FPS, 4 HDMI, 3 Ethernet ports, etc, etc.

3DO was a neat machine at the time, but never even close to being worth the $699 price, and the PS1 decimated it quickly at launch.



For a company that crushed it's competition with price ($299.99 PS1 against the $399 Saturn, then dropped the PS1 price to $199 the next year), I never understood how they got the idea that such a high price is a good idea. They believed their own hype I guess.



I definitely disagree with Tretton's comment regarding price, price DOES kill a console. If the PS3 would have launched at the same time, same price as the 360, the current console situation would probably be very different.

Chris Skuller
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I have to agree. If the PS3 released at a more competitive price, I can't see how Sony wouldn't be the undisputed video game champion right now. I know a LOT of people that were crazy stoked about the PS3 until they heard the $599 price point and decided to go with the 360.

Ian Uniacke
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Anecdotally, I always wanted a Dreamcast even after being disappointed with the Saturn, but price was always what stopped me becoming a purchaser.

Arnaud Clermonté
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From what I remember, it's the PS2 that killed the Dreamcast, not its price.

Eric Feliu
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Where was the PS2 sales wise 4 years into it's life cycle? I am sure the numbers were much better.

kevin Koos
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PS2 hit 50 million consoles in less than 3 years. More impressive went from 40 million to 50 million in 4 months. Basically just over 2 years in the US to hit 20 miilion(wasn't launced in the US until Oct 2000) After 4 years PS3 still hasnt hit 20 million in the US. It then went on to hit 100M 5 years and 9 months after release.

Brent Orford
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Sounds like he's not to worried about Hotz's exploits effecting sales.

zed zeek
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well that should actually help console sales

software sale OTOH pfffttt

Doug Poston
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Sounds like he's preparing us for major sticker shock.

R G
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Agreed. Hopefully no more than $350. I won't buy day 1 if it's past that.

Lo Pan
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Sony for its higher end electronic products generally overcharges versus the competition. The expectation is you 'want' to pay the premium because of the Sony 'style'. Apple does this, but usually delivers on the style.



I only play the PS3 for exclusives, and in fairness, when SCEA/SCEE provides developers making exclusive games with Tier 1 tech/code support the results are amazing. Unfortunately, the 'secret sauce' that make these games rock aren't provided to ports. Therefore for ports its always the Xbox since the performance (and aliasing) is much better in nearly every game.

Lyon Medina
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Just how many times is the PS3 gonna "Hit it's stride". It's the same statement I hear every year that everytime I hear it I think negative of Sony. It sounds so fake now, and it just makes me just wonder what is really going on with Sony and it's gaming division.



Its not something that I'm saying Sony is failing and their marketing campaign as of late has been really good. Best it has ever been since launch ( and what I mean is since the beggining of launch. Not the launch advertisements them selves. Autrotious). Its just that it feels like Sony is being dishonest.

Ian Uniacke
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2011 is "THE" year of Ps3. ;)

Lyon Medina
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So was 2010,'09,'08. I feel like its some kind of political campaign where Sony is trying to be elected.



Excess info:

Sony is a great platform I dont own a Playstaton 3 but I understand the need for it. Would I buy one no, because I already made my investment in my Xbox, I am not a fair weather fan, but I'm an not blind to the issues that plauge my choice system to what it like Sony does alot.

Eric Kwan
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I feel like the Apple/Android/Nintendo release models show that people are willing to shell out not-insignificant amounts of money for what is essentially the same product every year. I think that, if the NGP presents itself as a compelling product, people will buy it regardless what they already own—just like how current iPad 2 owners will still buy iPad 3 and how current 3DS owners will still buy 3DS Lite or whatever.

Ian Uniacke
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Yes but there is a ceiling I think, based on what people can actually afford to pay. Ps3 at launch smashed straight through that ceiling.

steve roger
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He sounds like a guy getting ready to slap a big sticker price on the PSP. They have done this in the past and found that it was better than undercutting themselves when the darn thing fails to sell.

Joe McGinn
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That's great Sony. In about ten years you'll have sold as many PS3s as PS2.

Taz Lumpkins
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Well that's the great thing about the Sony consoles. They have a lifetime spanning 10 years or more. Given the PS2 has achieved the majority of it's sales at price points of $200 and less, whilst the PS3 is still at the PS2 launch price of $300, and nearing on 50 million sold. So if we continue out the timeline the PS3 will likely have a longer lifecycle than the PS2, given the firmware upgrade capability and pre-existing support for Blu-ray and frame packed 3D (active glasses) gaming.



Long life-cycle is good news for devs, who can create multiple iterations during the cycle after coming to terms with the hardware during the initial learning curve, which was certainly steep with the PS3.



Also good for the gamers, who can buy with confidence knowing support for the PS3 will be there with games 5 years down the track.


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