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

ExTiX 15.2 Is Based on Ubuntu 15.04 and Debian 8 Jessie, Features LXQt and KDE Editions

After announcing his new RaspArch distribution that helps users run the powerful Arch Linux distribution on a Raspberry Pi 2 Model B computer board, Arne Exton informed Softpedia about the immediate availability for download of the ExTiX 15.2 Linux operating system. Read more

RaspArch Offers an Easy Way to Run Arch Linux on Raspberry Pi 2

Arne Exton had the pleasure of informing Softpedia about a new distribution of GNU/Linux created from the ground up for the Raspberry Pi 2 tiny computer board and called RaspArch. Read more

Leftovers: Software

  • goobook: Command-line contacts
  • Calibre eBook Editor Gets Much Better Support for DOCX
    Calibre, a complete application to edit, view, and convert eBook files, has been updated yet again, and the developer has added a number of new features and various other fixes.
  • GNOME Builder - 3.16.2
    I released 3.16.0 a couple weeks ago without much fanfare. Despite many months of 16-hour days and weekends, it lacked some of the features I wanted to get into the "initial" release. So I didn't stop. I kept pushing through to make 3.16.2 the best that I could.
  • PacketFence v5.0 released
    The Inverse team is pleased to announce the immediate availability of PacketFence 5.0.0. This is a major release with new features, enhancements and important bug fixes. This release is considered ready for production use and upgrading from previous versions is strongly advised.
  • What are good open-source log monitoring tools on Linux
    In an operating system, logs are all about keeping track of events, be it critical system errors, resource usage warnings, transaction history, application status, or user activities. These logs, which are stored as (text or binary) files in the system, are useful for system auditing, debugging and maintenance. However, with so many different system entities generating log files, and even at growing rate, the challenge as a system admin is to how to "consume" these log files effectively.
  • Apache Fortress Core 1.0-RC40 released !
  • Say Hello to Open Source Puppet 4!
    Production-ready Open Source Puppet 4 is now available! We’re excited to announce new features and enhancements that will extend your use of Puppet for faster, more consistent management of server configurations. We’ve added capabilities to help you save time, reduce errors, and increase reliability.
  • textprint: Visually impressive, in only 18K
    textprint takes a flat data file as input, and arranges it graphically to fit the terminal without distorting the image. From there, textprint goes from zero-to-60, in about two seconds.