It’s a good news day for Sony on no less than two financial fronts, as the company publicly declares that for the first time in almost 4 years, the PlayStation 3 is no longer hemorrhaging money from its every USB-shaped orifice.
Speaking to IGN, Sony Worldwide Studio’s bigwig Shuhei Yoshida revealed that “This year is the first time that we are able to cover the cost of the PlayStation 3”, stating that although hardware sales are still failing to rake in the big bucks for Sony, the manufacturing giants aren’t “bleeding like we used to”. Although such candid honesty with regards to the PlayStation 3’s ability to generate cold, hard cash makes a refreshing change to the spiel we usually hear from the major platform holders, Yoshida was quick to play down talk of any future price cuts. Instead, Sony look likely to concentrate on high profile moves into.. well, Move, and the roll out of 3D hardware.
What remains unclear however is how much money Sony needs to generate to compensate for the PlayStation 3’s formulative years, during which a struggle to shift units, high production costs and a battle with Microsoft and Nintendo saw Sony post huge losses on a pretty regular basis. Today however could mark a turning point, and with approximatley 6 years of Sony’s estimated 10 year life cycle for the PlayStation 3 still to go, time is on their side.
Key to this new era of converting breaking even into profitability could be PlayStation Plus, which officially launches today courtesy of updates for both the PlayStation 3 and PSP. Firmware 3.4 for PlayStation 3 will enable users to shell out more cash in the PlayStation Store for either a 90 day or a full year’s subscription, but will also add better Facebook integration and new photo and video networking options. Update 6.3 for PSP will also provide PlayStation Plus access to PSP users.
We’ve already done our fair share of moaning about PlayStation Plus, but from a financial perspective, the annual fee’s for what amounts to little more than aging software, DLC packs and themes should provide a welcome avenue stream;even from a modest uptake of early subscribers.
Email the author of this post at matc@tap-repeatedly.com.
Interesting interesting… typically you’ll see a platform start making money on hardware within three years, but this generation has been unique in a number of ways. Personally, my feeling is if Sony is depending on Move and Plus to net a profit, the company is in for a nasty surprise. Much better to go with the classic “give away the razors to sell the blades” approach. 2009/2010 has seen some great opportunities with Sony exclusives – Infamous, Demon’s Souls, Heavy Rain, Uncharted 2, etc – a genuine reason to want to own the platform. Me, I love my PS3, much more than I ever loved my 360. I do wonder whether the firm will turn black this generation.
I agree with Steerpike here, if they’re relying on the PS Plus service and Move to shift more units then I’m dubious whether they’ve got the right idea. It’s clear that the PS3 has had considerable success in the last year thanks to a host of great titles and only really because of those. Sony also has a great opportunity to really get behind the indies as well with Microsoft and Nintendo apparently dropping the ball over the last couple of years. They need to stop pissing about with all these extras and focus on getting the core services working to their fullest. Sony, take a long hard look at Steam. See what I mean? I’ll see you in a year.