Space Ramblings

Will Sony’s Price Cuts Cut its Throat?

It is no great secret that Sony was losing money on the PS3 even at its original price and once the PS3 failed to catch fire, Sony has resorted to another 100 dollar price cut and now halving the price of the SDK. Will halving the price of the SDK to somewhere around 10 grand instead of 20 grand really generate more games? Sony had better hope so because in a lesson from the Atari Jaguar and the Sega Dreamcast, it’s more about the games that you have, than about your specs. Jaguar’s 64 specs didn’t help save Atari. Sony’s PS3 feature set is not moving the console. The reality is that most people are not so good at telling one bit of HD from another, they do however appreciate great games.

If Sony can keep the prices down, it may move more PS3’s but at what sacrifice. If the Playstation 3 was a money hole even before the cuts, Sony slashing its own revenue stream further can only be making things worse. Sony has become like the Germans deep in Russia, advancing ahead because they’ve come too far to retreat. A wiser corporate policy might be for Sony to cut its losses and come back better than ever while allowing Nintendo’s own culture of corporate arrogance to quickly begin alienating everyone in their path.

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