Language Selection

English French German Italian Portuguese Spanish

Sony could wait till '07 to launch PS3

Filed under
Gaming

Buried in an analyst's memo, written shortly after last week's Electronic Arts earnings call, was a hidden gem. According to the widely read team at Wedbush Morgan Securities, Sony may delay the release of the PlayStation 3 until 2007--if exactly the right conditions prevail.

Currently, the console is slated to appear in Japan before the end of that company's fiscal year--March 31, 2006--and in North America before the end of 2006.

Given the right set of circumstances, however, that release window (at least in North America) could intentionally lag until after the 2006 holiday buying season.

In a research memo sent to investors, Wedbush senior analyst Michael Pachter set up the following scene for a delayed PS3 launch. It starts with the current-generation Xbox being priced down to $99 post-Xbox 360 launch, but no lower. Concurrent with that situation--an Xbox 360 at an unspecified price and the Xbox at $99--Sony would drop the price of the PlayStation 2 to $99.

There are two components to that pricing strategy: the first is that a $99 PS2 would offer a significant distraction as the 360 launches. As Pachter states: "We believe that the company will attempt to disrupt the Xbox 360 launch with a price cut, and as a result may succeed in diverting attention away from the higher-priced next-generation console."

In addition to the "diversion rationale" is the supporting fact that "the redesigned PS2 carries a manufacturing cost of less than $99," according to Pachter. New consoles are noteworthy for the fact that at the beginning of their manufacturing cycle, the units are sold at a loss. Given that the PS2, according to Pachter, would cost less to make than to sell, it behooves Sony to extend demand for that product for as long as possible. And if Microsoft takes the Xbox price no lower than $99 (still a loss for Microsoft, according to Pachter), Sony will find itself in a win-win situation.

Another cornerstone in Pachter's theory is Sony not wanting to disappoint consumers and retailers by having too few units in the channel over the high-demand weeks of this coming December. Pachter says, "we believe that Sony suffered the ignominy of being unable to satisfy holiday ['04] demand in order to increase its gross profits over the short term."

If the PS3 launches in late '06 and suffers the same fate, Sony would be embarrassed for a second straight year. Without any PS3's in the channel, there's no chance of a shortage of stock. A backward theory perhaps, but a theory based in fact nonetheless.

The key point in Pachter's argument weighs heavily on what sort of showing the 360 has at launch. If the 360 tallies significant sales early, Sony would need to fire on all cylinders and get the PS3 into the channel ASAP. However: "Should Microsoft fail to garner sufficient software support to gain an insurmountable lead, we think that there is a possibility that the PS3 launch will slip into early 2007."

Following the distribution of the memo last week, GameSpot spoke with Pachter who emphasized that he "posited the thought as option value for Sony." Continuing, he said, "I think the 360 will do quite well."

But if the 360 does an about-face at launch and tanks, the above Plan B could be an option the cash-strapped Sony might just consider.

By Curt Feldman -- GameSpot

More in Tux Machines

Here’s How to Create the Perfect Ubuntu Origami Unicorn - Video

After announcing last week the Ubuntu Origami Unicorn contest, which can bring an awesome new BQ Aquaris E4.5 Ubuntu Edition phone to a user that folds the best-looking Unicorn, today Canonical decided that it’s finally time to show the world how to make the perfect origami unicorn. Read more Also: Canonical Eyes Telecom, NFV Innovation with Ericsson Cloud Partnership

Docker 1.6 Coming April 7

Some of the big additions set to debut in Docker 1.6 will be a native Windows client. Building Docker images will also get a boost with the ability to building images from an image ID as well as having the ability to impose constraints (memory etc) on images. Read more Also: Could Docker replace package management?

Linux Mint Needs a Huge, Modern Overhaul, More Artists and Web Developers Are Needed

We’ve announced earlier today, March 30, that the Linux Mint developers have released their monthly newsletter where they’ve reported the changes implemented in the upcoming releases of the LMDE 2 (Linux Mint Debian Edition), dubbed Betsy, as well as the Linux Mint 17.2 (Rebecca) operating systems. Read more

Creating a Unified Ubuntu Experience

On it's own, Ubuntu is a solid desktop Linux experience. It offers ample application choices and it's easy to use. But one area I would like to see greater focus is mirroring one desktop to another. That is, being able to find the same documents and other files I use on both desktop machines. In this article I'll explore options I've found useful in creating a unified Ubuntu Experience. Read more Also: The big lesson from Ubuntu, Windows and Coca Cola