Gears of War boss says PS3 price cut makes no sense now

July 25, 2009

Gears of War boss says PS3 price cut makes no sense nowWith the state of the economy across the globe, many companies are being hit hard. Like many of the CE businesses out there, Sony has been having a difficult year and the fact that analysts are clamoring for a PS3 price drop isn’t helping. The boss of the studio that brought you Gears of War 2 had some choice words to say about the situation.

Due to the recession the CE sector has taken a big hit this year. With the most expensive game system out on the market currently, things have not been all that rosy for Sony. However, the company has maintained that it will not lower the price of the PS3 until it can be manufactured at under break-even costs.

According to Eurogamer via Gameindustry.Biz, Mark Rein VP of EPIC Games indicated that a PS3 price drop this year would have made things worse for Sony so it wouldn’t make sense to do it at this time.

Rein states:

The truth is Sony has had a difficult year and I think they had to do what they had to do to try to be profitable. They have their own financial issues to solve and lowering the price of the console would probably have made their situation worse. They will get around to it in their own good time. If you’re willing to look at this as a long-term play, they’re going to be just fine.

I have to agree with Rein here that it really doesn’t make much sense to lower the price of the PS3 at this time. PS3 sales have slumped a bit but its still selling around 165k units per month at $399, which isn’t exactly rock bottom when compared to the Xbox 360’s 241k per month in the U.S.

Lowering the price will spur a huge sales spike, but at what cost? The bottom line is that Sony needs to be able to sell a lot of units without losing a penny on manufacturing the PS3. The only option that really makes sense for Sony is to continue to work on reducing manufacturing costs until the company can drop the price of the PS3 and still remain profitable. As Rein stated, “If you’re willing to look at this as a long-term play, they’re [Sony] going to be just fine.”


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