PS3: Pleased to meet you
19th Mar 2007 | 16:20
Consider this: no previous console selling above the $400/£400 mark has ever been a success. So has Sony really dropped the ball? We take a look at the PS3's journey so far and assess its prospects for massmarket dominance.
Anyone who's seen a PS3 running on a beautiful HDTV will be in no doubt that it's an emotionally stirring and exciting piece of kit. But the road to retail was rocky to say the least. Delayed by over a year and with manufacturing costs spiralling ever upwards there's still considerable doubt consumers will buy into a games machine retailing for £425.
The real cost of PS3
There's no question that forking out £425 on a game console is excessive (especially when you consider it retails for $599 in the US (£304) and 59,980 Yen (£250) in Japan). But Sony's strategy was always ballsy: it set out to future-proof the machine by giving it a potential shelf life of ten years.
The PS3's Blu-ray optical drive, bespoke chips, RSX graphics processing unit and Cell Broadband Engine are estimated to cost more than $600 and that's before you consider all the other components and manufacturing costs.
In fact, Sony is rumoured to be making a loss of around $250 on every PS3 sold. The only sweetener - if you're willing to wait - is that all this technology will inevitably come down in price leading to price drops in the future.
Pleased to meet you?
The launch of a console is never a true reflection of its eventual success; while PS3 sold out in both Japan and the US when it hit shelves back in November 2006 the real figures tell a different story.
Sony set itself a worldwide shipping target of 6m units by March 2007, however a recent report by Numura Securities suggests that Sony has achieved only 75 percent of its fiscal year's sales following lower than expected results in the US. The report went on to say that only 4.5m units are likely to be in homes by Sony's March deadline. Which is no disaster but when you consider Nintendo's Wii is selling around double the number of PS3 units in both Japan and the US then Sony should have pause for thought.
Indeed, anecdotal evidence suggests that retailers in the US are struggling to shift PS3 units and some Japanese stores have begun implementing discounting strategies to increase sales. According to Bank of America lackluster PS3 sales will also be a major blow to publishers as 21 percent of their revenue is pinned on PS3 software sales. Based on recent channel checks at 50 US stores 78 percent had PS3s in stock. Sony argues this is due to healthy distribution.
Whichever way you cut it there's a general feeling that PS3 is underperforming due to a less than stellar software line-up and the high price. In the UK retailers such as Gamestation and Game still have many pre-orders available, which tells its own story.
Videogame Hardware Sales - US (Jan 1st - Jan 31st 2007)
Videogame Hardware Sales - Japan (Jan 1st - 21st 2007)
Gremlin in the machine
We don't want to paint a gloomy picture but it's fair to say that the PS3 has had a few technical problems since it launched. These mainly surround one of its key selling points: the ability to output crisp and gloriously beautiful visuals to HDTVs. For instance, if you have an older 1080i HDTV the PS3 fails to upconvert the 720p signal to 1080i. In short, you get a crappy picture that downscales to 480p, which is sometimes worse than PS2 quality. The bug hasn't affected everyone but it's a shambles nevertheless.
There have also been similar issues with connectivity via HDMI cables producing audio cut-outs and picture blinking. And that's before we even get onto the subject of backwards compatibility - in Europe it's estimated that only around 40% of PS2 titles will work on your PS3.
Sony also miscalculated the added complexity of the cell infrastructure and its adverse effects on development. Though the PS2 was initially a challenge for the developers by all accounts the PS3 is even worse.
Small devcos in particular have expressed their dismay at how difficult the machine is to code for. Indeed, before the PS3 was released in the US Sony Online Entertainment fired one of its 3D artists, Josh Robinson, for a negative blog about the machine.
The comment, "You could always tell where the PS3 dev box was because it's the room that had the F-bomb coming out of it half the day," clearly didn't go down well.
Will the PS3 rule?
The PS3 has had its critics, a few teething troubles, and is currently being outgunned by Nintendo's Wii in terms of monthly sales figures.
But while it may take a little longer to infiltrate the massmarket we shouldn't forget that this is the only console capable of 1080p, has built-in Blu-ray technology and is future proofed far beyond any other console.
Sony's PlayStation brand has also become synonymous with gaming cool, at least with massmarket punters. In short, don't expect PS3 to bomb - it's still likely to dominate in the medium to long term. However, you can't help feeling that a price cut and a killer game would help matters...
Lookout for a lot more PlayStation 3 features and reviews on CVG in the run-up to the March 23 launch