Says PS3 needs a price drop.
There’s a general agreement that Sony needs to drop the price of the PS3, but when consumers are still willing to purchase the consume at its current price such whining doesn’t carry that much weight. When you’re Bobby Kotick, CEO of Activision, however, and you suggest Sony should consider adjusting its pricing it might be time for someone to sit up and pay attention.
Speaking to The Times, Kotick explained: “I’m getting concerned about Sony; the PlayStation 3 is losing a bit of momentum and they don’t make it easy for me to support the platform.” The issue, says says Kotick is that: “It’s expensive to develop for the console, and the Wii and the Xbox are just selling better. Games generate a better return on invested capital on the Xbox than on the PlayStation.”
According to Kotick, a price drop would, as well as improving console sales and, as a result, games sales by dint of there being more possible buyers, up attach rates – the number of titles purchased by each console owner. “They have to cut the price, because if they don’t, the attach rates are likely to slow. If we are being realistic, we might have to stop supporting Sony,” says Kotick. “When we look at 2010 and 2011, we might want to consider if we support the console — and the PSP too.”
While I’ve certainly never found the price paid for a console factor in deciding whether to buy games for it, I agree that a price drop can’t really hurt Sony’s bottom line. Considering the nearly £2 billion the PS3 has cost Sony, it doesn’t really make much sense to harm worry about losing more money on the hardware – at least from where I’m standing.
Sony’s gaming division profit henceforth is going to come from developers, like Activision, which incidentally Kotick says handed over some $500 million in royalties to Sony last year. Surely keeping its developers happy should be a priority for Sony, even if appeasing consumers with a much-demanded price-drop isn’t a concern?
Sony has responded to Kotick by saying, well, nothing really. According to a statement: “We enjoy healthy business relationships with and greatly value our publishing partners and are working closely with them to deliver the best entertainment experience.”
We probably shouldn’t expect Sony to change its “no price-drop” stance any time soon, then.