
Sony has lost over $3 billion on the PS3 - chaostheory
http://videogames.yahoo.com/feature/sony-has-lost-over-3-billion-on-the-ps3/1223467
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pmjordan
It's all those pesky scientists building HPC clusters from PS3s _and not even
playing games on them_.

<http://en.wikipedia.org/wiki/Playstation_3_cluster>

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Retric
I think they also lost money from people using it as a blue ray player. But
they won the HD-DVD war which is probably worth a lot more than 3billion.

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chaostheory
unfortunately for Sony, that's not the end of the format war. the bigger war
is with downloads; both legitimate and illegal...

to be fair MS has also lost a considerable amount, plus this is the first time
Sony has sold a console at a loss (Nintendo still hasn't done this yet).

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Retric
I think it's going to be ~15 years before video downloads take over 50% of the
DVD/Blue Ray market in the US so they have plenty of time to milk Blue Ray.

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comatose_kid
Let's do the numbers:

Dual Layer Blu-ray capacity: 50 Gigabytes. Verizon FIOS - 20 Mb/s for
$70/month, or 50 Mb/s for around $144/month.

So, how long would it take for a person on FIOS to d/l this?

@ 20Mb/s: 50000MB / (20 Mb/s / 8 bits/Byte) = 50000MB/2.5 MB/s = 20000
seconds. Which is ~333.3 minutes, or about 5.5 hours.

@ 50Mb/s, you have (20Mb/s / 50 Mb/s) * 5.5 hours = ~2.2 hours.

Yes, you're not going to get full speed, but even a factor of 2 slowdown is
faster than waiting for netflix.

So, it seems that the network required to do this is already being rolled out.
For example, Verizon market penetration is outlined in a recent press release
[1], indicating that Verizon will offer these speeds to 10 million subscribers
within the next week or so.

As you said, it may be ~15 years, but I think it will be a lot shorter - I'd
guess 5-7 years. I can't imagine that comcast is sitting around while verizon
makes inroads into their userbase. They will counter, driving prices down and
increasing market penetration for these high speeds.

[1]: <http://investor.verizon.com/news/view.aspx?NewsID=925>

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Retric
Fios might hit 20% penetration across the US in five years but it's only going
to slow down after that. Today it's only in 16 states and _Although the
network already reaches 10 million homes and business, it will reach more than
18 million by 2010._ so it's growth in availability is good but not all that
extreme. And a lot of people who could use the service don't. Personally I
would go with FIOS but I am dumping my 20Mb Comcast connection for 3Mb DSL
because they keep messing with my line.

PS: Once they started to send RST packets on non BT traffic I decided to jump
ship so that BR movie is going to be 37hours for me.

EDIT: I only point this out because if your business model assumes most people
will have 20MBit connections in 5-10 years you’re going to be sadly mistaken.

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metatronscube
Development costs of the PS3 must be huge, but I don't think its 'lost' money,
the thing still has a shelf life of 5+ years at least.

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Tichy
How do you arrive at that estimate? I am guessing the PS3 technology is
already outdated now?

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marcus
Look at the average life expectancy of consoles over the years 5-6 years is
about the right number. PS2 is still selling and it was released in 2000 but
that is about as old as it gets.

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Tichy
Yeah but that might have been a lucky shot? PS2 maybe has a cult following
because of the games, but what does the PS3 have to achieve the same?

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marcus
PS sold 1995-2006, Original Xbox 2001-2005.

And don't forget the Microsoft/Nintendo/Sony are losing money on each machine
only to make it up in game royalties (except for the Wii which actually sells
at a profit), and games are still sold a couple of years after a platform is
discontinued.

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palish
A loss at launch is typical for consoles. (The XBox was not profitable when it
first launched, either.)

Still, 3bil is damn high.

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marcus
You know what they say a billion here two billion there, pretty soon it adds
up to real money.

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patrickg-zill
They will cost-reduce it some more and with the further cost reductions, plus
royalties etc. will end up making money. Remember as well, they are
manufacturing massive volumes of Blu-Ray readers, which saves them money when
they sell standalone BR boxes to home theater folks.

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ScottWhigham
Does that make PS3 the new New Coke?

