kajiaisu

[QUOTE]
Sony sticker shock: $500 PlayStation 3, $249 PSP are possibilities
Revenues, sales, even price tags are on the rise as analysts address the upcoming transition to next-gen machines.

In a year-end report that puts Leo Tolstoy to shame, industry analysts Michael Pachter and Edward Woo of Wedbush Morgan Securities presented the industry today with a 144-page tome of charts, theories, prognostication, and predictions. Unlike Tolstoy, however, their book has a happy ending.

Titled: The Definition of Insanity: Why The Next Console Cycle Will Start Off With A Whimper, the analysts present an "in-depth look at interactive entertainment software." And while many of the report's data points were revealed in May, during a Pachter-hosted E3 Conference Program luncheon, most of the data is, in fact, new.

Probably the most exotic of the report's predictions was a reference to Sony's PlayStation 2 update. The report suggests Sony is considering adding PSX and TiVo-like functionality to the PlayStation 3. And if it does, the sticker price on the unit could climb as high as $500. The report states: "We expect Sony to introduce its next console with more functionality than its current console. We base this conclusion on the introduction of the PSX, planned for late this year. The PSX will include a Digital Video Recorder (similar to TiVo) functionality; broadband Internet accessibility; wireless LAN functionality; and DVD read-write functionality. These features add approximately $500 per unit to the cost of production, resulting in an expected launch price of around $700. By late 2006, we expect the cost to include these features to decline to around $250, but speculate that the next generation console, should it include these features, could debut at $500. At this level, we believe that many consumers will be alienated."

Other key findings include an industry-wide growth rate (of revenues) of 10 percent per year through 2010 and a growth rate of 14.5 percent in revenues for console and handheld software in the US for the next three to four years.

The report also suggests US publishers will begin to see a significant increase in sales of game software in Japan, and that software sales will surpass domestic music sales (in revenues) over the next two years. Of note on the hardware front, the analysts expect that due to increasing multimedia functionality (DVD playback, high-def capabilities, and Web access) that the percentage of households that own at least one console will climb from 38 percent seen during the 32-/64-bit cycle to 52 percent during the ongoing 128-bit cycle.

On the PC front, the report isolates three titles that will act as key market movers: Doom 3, The Sims 2, and Half-Life 2, and that PC sales overall will be driven to "near record levels."

As well, the Wedbush analysts check in with their estimate of the PSP launch price, pegging the hardware to sell at $249.99 and software to retail for around $30.

Ultimately, it will be female gamers, the increased spending power of "tween" gamers (8-to-14 year olds), and aging but committed gamers introduced to interactive entertainment on the Atari 2600, for example, that will fuel the continued and dramatic growth of the industry.

The report's summary closes with the following brave prediction: "We expect interactive entertainment to be the fastest growing entertainment sector over the next five to 10 years. We forecast the interactive entertainment industry to grow US software sales by approximately 11.4 percent per year over the next three years. We project book and music sales to grow less than 5 percent per year over the next three years and we believe that box-office movie receipts will grow in the 2-4 percent range over the same time period. Using our projected growth rates, we forecast that the US interactive entertainment industry in 2004 will continue to be larger than these competing entertainment sectors (with the exception of the music industry which we believe will be surpassed over the next three years), becoming the largest of these major entertainment sectors within the US."

By Curt Feldman -- GameSpot
POSTED: 06/21/04 04:52 PM PST[/QUOTE}


HAAAAAAAAHHAAHAH!

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Ragnar Danneskjöld

Their overdoing things,, They will die soon.

RyZ

I just read this peice on gamespot myself. It is nothing but speculation at this point but the projected pricing seems very plausible. That means here in Canada the PSP would retail at just under $400!!!! As a 24 yr old gamer with plenty of friends that game that are around my age or older I don't know even 1 person who will buy a handhald at $400 (CDN) no matter what it does or who it is made by....................... unless it picks up women for you too!!

Curtis

I know what you mean man, I cant see myself paying 400$ for the PSP. Id REALLY rather spend the money on an IPod, which would be my main reason for owning a PSP (for the music). It just seems to be being such a waste, I dont get it.

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chowdy

Ouch. $500 is a lot for a console, especially coming from a generation when some consoles launched with prices of $250 . The PS3 better make me breakfast for $500. And a damned good breakfast, at that.

kajiaisu

It also better have a pizza maker too....

Yeah I hope Sony dies, and they go back to making Tvs, and then nothing works out and they file for bankruptcy.

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Sirius

you act as if they did somthin horribly wrong to you

I wish the best for sony in everything they do cept consoles

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Fierce Deity

Sony is just full of themselves. They think if they market any product with virualy any price tag and as long as it bares the Playstation name, it'll sell. Granted, none of this is confirmed, but it does sound very plausable.

chowdy

They killed my baby, Dreamcast.

Pojo

If the PS3 launches at $500 (which it won't) it'll fail miserably. $300 is the absolute most that I will even consider paying for a system, and even that is stretching it.

...as for the PSP, $250 is bad, but not as bad as $300. I still won't buy it.

kajiaisu

Yeah....DreaMCAST pwnz!!!!!!!!

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Ragnar Danneskjöld

Yes, Cube was 200$ ahhh so sweet. Revolution will be 300$ i think i read somewhere though

Dawson

If any of this is true, look for M$ or Nintendo to be leading the gaming market in 5-7 years.

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Advance

The price point on the upcoming generation could realistically go to $250, but I don't see how it could go any higher.

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What would you do if you were stuck in one place and every day was exactly the same, and nothing that you did mattered?

Pojo

$250? I'd think they would be $300 at the very least. Why would Sony bother lowering their console to $250 when it did so well at $300?

RyZ

Exactly. I would think that the next gen consoles will have to retail at either the same price or higher than the current gen consoles did upon release.

nenned

My guess is that if this is true, there will be 2 versions of PS3. The standard version for $300, and the deluxe version with TiVo and other extras for about $500.

Ninja Sole

lol, remember how expensive the PS2 was at launch? and do you know what console now dominates the console market?

Sirius

Wild guess......PS2?


My local kb Toys was selling ps2 for 500 or somthing iono its was outrageous

Some kid from my school bought one at that price. He would make fun of people who didnt have one iono like a month after that the price droped. He was so stupid everyone hated him.

**** u Robert

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