PS3 only two million behind Xbox 360: drop in profits
Sony recently released its financial report and its a bit of a mixed bag with sales up but profits down. Sony’s PlayStation gaming division is doing remarkably well despite stiff competition and the state of the economy worldwide.
Disaster in Japan
Unfortunately, Sony’s bread and butter TV division has suffered this year due to various unforeseen issues. Sony has been hit hard this year as reiterated by Sir Howard Stringer, with 10 factories halting production temporarily due to the earthquake in Japan. The value of the Yen also skyrocketed against the weak dollar. Overall as a whole, Sony posted a net loss of $350 million this year, in contrast to the $398.3 million profit it made last year.
Sony still manufacture’s some of its TVs in Japan, while its competitors like Samsung and other major CE giants have off shored all of its manufacturing to China. With the Yen being so strong, labor and cost of running these plants have been astronomical.
Strategy Forward
Sir Howard Stringer set in motion a plan earlier this year to make redundant some of the manufacturing plants by partnering with companies like Toshiba. In addition, the CEO took charge of its mobile division by pushing to acquire Ericsson’s mobile division.
Stringer appears to be more focused than ever on delivering his vision of the “four-screen strategy” merging smartphones, tablets, PCs and TVs with Sony’s music, movies and the PlayStation Network platform.
As The New York Times puts it, Sony’s PlayStation Network’s 90 million accounts, plus Qriocity makes it perhaps the world’s only real contender to Apple’s iTunes.
PlayStation Carrying the Division
The PlayStation gaming division seems to be healthier than ever, with 3.7 million PS3s sold in the three month period, up from 3.5 million last year. PSP sales are also up to 1.7 million, from 1.5 million last year. In addition, PS3 software units are up to 37.4 million units from 35.3 last year with PS2 and PSP declining.
This brings the overall PS3 worldwide total sales number to 55.5 million units, which is two million behind Microsoft Xbox 360’s 57.6 million units. It appears that Sony has been able to shave a million units off the difference from last year and further close the gap between the two consoles. It will be interesting to see if Sony can put this rough year behind it and bounce back focused on its strategy to unify all of these platforms next year.
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18 Responses to “PS3 only two million behind Xbox 360: drop in profits”
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November 3rd, 2011
(OT) Definitely a must watch:
http://www.youtube.com/user/egoraptor#p/u/6/8FpigqfcvlM
November 4th, 2011
I mentioned this very thing in another thread.
Have to admit, I’m guilty of buying Samsung, though I didn’t think they were made in china.
Difficult times for companies trying to compete with cheap workforces in other manufacturing nations.
I guess the up side is that the likes of china are quickly raising the living standards, and the cost of manufacture is rising rapidly, so there is a glimmer of hope that the west & the likes of Japan will stay afloat long enough to be able to compete, or at least keep the edge with regards to quality to ensure there market.
As for the sales, it looks like the PS3 will just catch the Total sales for the 360 just as this gen comes to a close.
I think the PS3 will continue to sell in the same way the PS2 has done, where the 360 will pretty much come to a stop when the next gen is launched, so in the end it could end up selling 10 to 15 million more than the 360 by the end of the life cycle.
If MS keep there promise of 100% backward compatibility, there is nothing to stop Devs continuing to make games for the 360 for a few years after the next gen is launched, that way the game will run on both platforms, probably with graphical enhancements on the newer machine just because of the improvements in rendering alone.
Not sure if Sony will be able to do this as the odds are strong they will dump the cell in favour of the better performing chip-sets now available which are more in line with the standard PC & 360 architecture than with the Cell + SPU set up.
Just need to wait & see I guess.
November 4th, 2011
@dans303:
That video convinced me, I’m going to have another go at that Mega Man game I downloaded for Wii. Mega Man X looked awesome.
November 4th, 2011
I will never ever buy Microsucks bloated sales figures grandstanding. They brought this filthy numbers war that has perverted and distorted the thinking of so many innocent gamers around the world.
And look at how Japanese gamers responded!
Yet in North America the opinionated gamers converged into a gamers people power against M$ massive mass media campaign tainted with FUD, lies, and grandstanding claims thus preventing another monopoly of the American market.
HAARPing Japan will have some serious repercussions on USA from China and Russia.
History will repeat itself again. its the classic battle of the SNES vs Sega Genesis once more. So many similarities.
And looks like Kaz Hirai was right about the subject of longevity. The American software giant has failed to suppress ailing Sony despite its billions upon billions of financial might.
I believe the PS3 will even surpass the 10 year life cycle that the PS2 enjoys even longer. With games like Uncharted 3 who needs a next Xbox or Wee U?
November 4th, 2011
Microsuck ripped off the Apple personal computer idea with Windows PC.
Microsuck ripped off the PlayStation idea with the Xbox.
It can never duplicate what the PlayStation brand has done for video gaming. It only cares for profit not video gaming progress.
What a rip off company Microsuck is.
Always imitative never innovative.
November 4th, 2011
@godless
I don’t foresee MS doing what they did last gen and abandoning the 360 once the new one comes along like last gen. Especially with Kinect to cater to the causal majority. There’s money to be made with last gen tech too. Sony proved this with the PS2 continuing to sell well right into this gen.
This is the only time I can remember consoles being so neck and neck in sales for most of the gen.
November 4th, 2011
Sony would’ve past the 360 in sales if it werent for all the issues they had to deal with during the first two quarter of the year when they went through an earthquake/Tsunami, Bad publicity/PSN Outage, shipment blocked from EU, etc.
It’s surprising to know that the 360 has trailed the PS3 by 11M ever since the PS3 came out.
Quarter =======================
*PS3 – 3.7M
*360 – 2.3M
Year 2011 =========================
*PS3 – 7.6M
*360 – 6.7M
Since the PS3 came out =========
*PS3 – 55.5M
*360 – 44.6M
Total Instal base ==============
*PS3 – 55.5M
*360 – 57.6M
November 4th, 2011
LOL hasn’t it been behind like 2 million for 3 year in a row. I thought it was gaining every year. Oh well whatever!!
November 4th, 2011
Ok Roca
I,m going to have to jump in here, cause you’re doing that thing you do with statistics again.
Firstly the xbox360 only sold around 6 million in it’s first year.
then the PS3 was launched, so the xbox did not have an 11 million lead before the competition was on the scene.
Xbox then opened the gap over the following year or so, despite the huge issues with reliability.
the reason for this was. . .IT HAD BETTER GAMES, AND THE MULTI-PLATS WERE BETTER ON 360 AT THAT TIME.
the PS3 has then in the last 3 to 4 years pulled in the cap to now be pretty much level in total sales.
So yes. .the PS3 is selling on average more consoles every year.
But do you not think that should be the case, for a company that pretty much had a monopoly on the adult games industry.
MS has done well to jump into this arena, and not only show Sony how to make money, but has gone from rank underdog to capturing a huge share of the gaming market from Sony.
Sony should not be proud of their performance with the PS3, MS pretty much gave them a lesson in how to do it right.
You guys keep slagging of MS for having billions of money to pour into the 360, but the FACTS are that Sony has lost billions just to have the PS3 competing with the 360
Sony has lost money on the PS3 trying to compete with MS who have made money on the 360.
it is Sony who have been reliant on having billions to through around, while MS at the mercy of its shareholders has had to keep it’s investments profitable, or you can be dammed sure they could have trashed Sony simply by selling at a loss and flooding the market in the first 3 or 4 years. leaving Sony with almost no one to sell their machine to.
Don’t use the MS has billions argument when it’s clear which of these corps has over spent to support their product.
November 4th, 2011
phranc
“I don’t foresee MS doing what they did last gen and abandoning the 360 once the new one comes along”
I’m not so sure, I think if the new machine is backward compatible they have no need to continue sales of the old one, unless it’s still selling really well, and the profits are too good to give it up.
MS will want to end what has been a generation plagued by piracy for them, I’m sure the next machine will be a little harder to hack, and all the industry will benefit from that, devs will be more keen to support a machine that is free of piracy.
I don’t like that Sony are pretty much openly supporting piracy with the continued sale of the PS2 and to some degree the PSP, these machine are still selling shit loads and have a huge user base. When you consider how few games sales there are, it’s laughable.
November 4th, 2011
“I’m not so sure, I think if the new machine is backward compatible they have no need to continue sales of the old one, unless it’s still selling really well, and the profits are too good to give it up.”
MS has been profitable on hardware for some time now. It would make more sense to continue to profit on every 360 sold to compensate the new console being sold at a loss.
“I don’t like that Sony are pretty much openly supporting piracy with the continued sale of the PS2 and to some degree the PSP, these machine are still selling shit loads and have a huge user base. When you consider how few games sales there are, it’s laughable.”
I never heard that argument before. I guess I could see it with the PSP, but the PS2? Is the hacker community that big on the PS2 and I’m just in the dark.
“Firstly the xbox360 only sold around 6 million in it’s first year.
then the PS3 was launched, so the xbox did not have an 11 million lead before the competition was on the scene.”
By the end of December 2006 where the PS3 released in November of that year with shortages, the 360 had an 8.7M lead on the PS3. That’s the largest gap there ever was. not 6M, and certainly not 11M.
“You guys keep slagging of MS for having billions of money to pour into the 360, but the FACTS are that Sony has lost billions just to have the PS3 competing with the 360″
True, but when all is said and done, MS is pocketing their money while Sony is developing some killer IP’s not solely relying on motion games. As a gamer I’d take Sony FTW, but as an investor I’d go with MS.
November 4th, 2011
@Godless
“Firstly the xbox360 only sold around 6 million in it’s first year”
You better get your facts straight pal…also you seem to forget that the 360 had almost a 2 year lead (18 months) in Europe..when you factor everything out the PS3 has outsold the 360 by almost 11M during the same time frame.
“Through 20 quarters (official numbers) on the market, Microsoft had shipped 44.6m X360s, compared to Sony’s 55.5m PS3s in the same time frame aligned from launch”
Again, we are talking about *shipped* numbers here.
November 4th, 2011
Godless
I’m all for killing off the 360 and moving on to the next. What’s the point of keeping it on the market. Make the games backwards compatible like you said and move to te next. Don’t create overhead making games for two systmes.
November 4th, 2011
Phranc
Everyone I know with a PS2 has it Hacked, which is pretty sad, when you consider that the games range from £1.99 to £4.99 second hand. and new games drop to under a tenner after a few months.
I’ve been tempted a few times to get one, but I just wouldn’t get around to playing it when I already have too many games on 360 & PS3.
“True, but when all is said and done, MS is pocketing their money while Sony is developing some killer IP’s not solely relying on motion games. As a gamer I’d take Sony FTW, but as an investor I’d go with MS.”
I agree totally here, and that Sony is the better option from a gamers perspective.
MS has too many greedy short term investors to look at the long term picture in the same way Sony do.
Roca
Not sure where the 11 million comes from.
IF we take a max lead of 8.7 million, and then take the current 2.3 million lead, that makes a 6.4 million sales advantage to the PS3 from the point at which it started closing the gap.
November 4th, 2011
@Godless
“Everyone I know with a PS2 has it Hacked”
And your point is??..That a non-issue for Sony as they are profiting from Hardware sale, not software sales. Even if they weren’t hacked Sony still won’t make any profit from software sales as the used game market is the dominant market for the PS2.
@Godless
The current lead is 2.1M, not 2.3.
I’m getting my numbers from the article below which states – “Through 20 quarters (official numbers) on the market, Microsoft had shipped 44.6m X360s, compared to Sony’s 55.5m PS3s in the same time frame aligned from launch”
But you’re right Godless (VGC is wrong again) I did the math based on the official numbers and PS3 has outsold the 360 by 6.7M
They also mentioned that the 360 had a 18 month lead un Europe..so idk if they factored that in to get the ~11M number.
http://www.vgchartz.com/article/88359/sony-loses-350m-in-july-sept-2011-ps3-shipments-within-2m-of-x360
November 4th, 2011
“I’ve been tempted a few times to get one, but I just wouldn’t get around to playing it when I already have too many games on 360 & PS3.”
I wouldn’t worry too much about it. The best games on it seem to be getting the HD remastered treatment anyway. I’d hold out for those myself.
I want the Ratchet and Clank series to get the treatment too.
November 4th, 2011
Jak and Daxter HD collection is coming next year.
FFX HD should be awesome (PS3 is in need of some quality JRPGs)
November 4th, 2011
Finally ive been freaking waiting for a jak and dax game…a remake will hold me over….fucking need a j and d game sometime this fucking gen….