Sony Cuts PS3 Production Costs
January 15th, 2008 by Will Prusik in Business, News, PlayStation 3
The economics of game consoles is a rather tenuous balance between costs and revenues, as most consoles are sold at a loss which is then made up in game sales. The Xbox 360 became profitable for the first time when Halo 3 sales shot through the roof. The Wii turns a profit because of the low production costs due to the emphasis on universal appeal versus processing power and graphical capabilities. Sony has gained ground in the console war: they’ve managed to slice the cost of producing their console from $800 to about $400. This is likely linked to simplicity of manufacture since there’s only a single SKU in production.
