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PS3 production costs halved

An article over at BusinessWeek has revealed an interesting fact; that Sony has been able to halve the production cost of the PS3.

“Nikko Citigroup’s Kota Ezawa estimates the games division will lose $1.4 billion this fiscal year, following last year’s $2.1 billion loss. And while he doesn’t expect the business to be prosperous until late 2009, Ezawa applauds Sony’s efforts to shrink the PS3’s chips and tweak its design. Already such changes have cut the cost per machine to around $400 now, from above $800 just before it went on sale in November, 2006, he says.

“We think the biggest factor here is that simplification has become possible through a reduction in the parts count, leading to a reduction in costs,” Ezawa wrote in a Dec. 27 report.”

Apart from its lack of quality exclusive games, the PlayStation 3’s problem has always been its high price point, which has been easily undercut by Microsoft and Nintendo. Now that they’re able to make them much cheaper though, Sony might be able to build some sales momentum and turn the console’s fortunes around.

The author of this fine article

is the Editor at Thunderbolt, having joined in November 2000. Get in touch on Twitter @PhilipMorton.

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