The Japanese Daiwa Institute of Research has predicted things may not be instantly rosy for the PS3 Slim.
 
In the last episode of TV Tokyo news program called Pipitto!, the program covered Sony's Gamescom announcement of the new PS3 Slim, which offers a higher capacity hard drive, reduced noise output as well as a lower price point. To help breakdown Sony's pricing strategy, the program turned to an analyst at Daiwa Institute of Research.
 
The analyst's contribution came in the form of various slides depicting Sony's material costs:  
 

Oh noes.

" Oh noes. "

When you think about how they had to shrink their old hardware down, and pretty much make whole new parts for it. The loss really don´t surprise me.

I'm not sure how much the slim will boost Sony's sales but $300 is an unbelievable price for something with as many features as a PS3. If Sony wants to kill it's profits I'll still be perfectly fine with my new PS3 but here's hoping things go well for them.

Yeah, this is only to start with, if the upcoming exclusive software support is as good as it looks, I don't think it will be too long till they start making money on every unit, even if it's not all that much to begin with.

Oh noes. I really hope this works out for Sony. It seems like it's a really bold move. I was just assuming they'd cut the cost of production to at least break even.
 
Hopefully they can get even soon, and then at least make money on software.

It's less losses than with original at least.

So they're making a loss for every PS3 Slim they sell BUT "if they increase their sales, the material cost will gradually go down, and so too will the losses."
 
Confusing but I think I can see how. How on earth did I pass economics?...

thats the nature of the business. How long was it before the PS2 hardware was profitable?!

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I hope they get around this, I mean, they really are catering to their fans.

Hahahahahahahahahaha.....I find this funny for some reason. All video game hardware loses money for almost its entire lifetime; the PS2 only became profitable within the last few years. But, yeah, $100 loss is a big cut.

The reason Sony can afford to do this is because they sell lots of other overpriced shit that people buy (TVs, Players, etc.).

" The reason Sony can afford to do this is because they sell lots of other overpriced shit that people buy (TVs, Players, etc.). "

All video game hardware loses money for almost its entire lifetime

" The reason Sony can afford to do this is because they sell lots of other overpriced shit that people buy (TVs, Players, etc.). "

" @PureRok said:

" The reason Sony can afford to do this is because they sell lots of other overpriced shit that people buy (TVs, Players, etc.). "

Sony's Gaming Department has nothing to do with their other departments fyi. Sony does alot of things in general, their different departments are pretty much separate companies in the big picture.   If SCE is bringing a loss to sony, they look at it as a bad thing no matter wheter they can cover it with their other departments or not. "

wtf tha pic is n japaneez.

Of course, this is how they make money, they expect you to buy enough games to make up the difference

I really hope they can pull this one off. Lord knows we don't want another SEGA on our hands. Not that I'm saying this will break Sony, it just sounds pretty dire.

Sony has to take this hit if they want to live past this generation. They've already fallen too far behind as it is.
 
Besides, they'll easily make that $100 back in accessories and first-party games.

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" Sony has to take this hit if they want to live past this generation. They've already fallen too far behind as it is.  Besides, they'll easily make that $100 back in accessories and first-party games. "

It's an interesting figure, but their business model is a little more complex than whether or not they sell the console at a loss.  Obviously game sales are a large part of it, but there are other reasons for taking the hit.  
 
Sony and Microsoft both look at their consoles as more than just an isolated part of the business.  Sony were prepared to take a hit on the console itself if it would help Blu Ray win the HD war - which they achieved.  The potential gain from being in such a dominant position in the HD market was supposed to outweigh the sacrifices being made elsewhere.  It hasn't quite worked out like this though, because HD in general hasn't taken off in the way it was supposed to, which means Blu Ray sales haven't been spectacular and Sony's HDTV sales even less spectacular.
 
Whilst Sony have had a rough time in the last year or so, I think they've quietly worked themselves into an extremely strong position going forward.

Sony are big boys, they got this.

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Even the original PS3 has been losing money for every console they sell. Having implemented a blue-ray player is the reason why they are losing money. So I don't think its a coincidence.

This news doesn't really surprise me.

So many awesome games coming out. I am sure the attach rates will be quite good. We all know 360 attach rates are much higher.

The other factor to take into consideration is not simply that their suppliers will charge less per unit if Sony can ramp up their economy of scale, but their licensees will be more willing to produce more and better games for the system to sell to the larger user base. And It's Sony's licensees who will like this most. Bobby Kotick, looking in your direction.

They had to take a gamble to get these things into homes. I hope it pays off for them.

Grat's to them I guess? They can lose  millions on the slim I would care a less, its just about time they put the pricing at what it needed to be.

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yeah it was like a $400 loss on every ps3 when it lunched

I hate to sound like the most immature idiot on the internet, BUT has anyone that speak spanish noticed the name of the show? Pipitto? HAHAHAHAHA. Sorry, I just had to say it.

no risk. no reward.

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Takes money to make money.

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And... So what? For all the Jr Execs out there in internetville Sony will never do anything right. The Playstation brand has been enormously successful on balance. As for the other Jr Execs that think M$ can do no right, well, if you are using a PC, you may be onto something. Windows 7 anyone?

Microsoft lost money on each Xbox they sold last generation because they had hard drives in them.  Now, look at where they are at. 
 
Sony needs the Slim to succeed.