News: Sony Dropping 20 GB PlayStation 3
While over the past few weeks there has been plenty of evidence that this change was coming, the news has still provoked a lot of discussion. While on the surface this move may simply appear to give Microsoft more pricing breathing room particularly with the introduction of the Xbox 306 Elite, this is a good move for Sony and future PS3 purchasers.
That may sound like an odd statement since things are forcibly more expensive to today's consumer, but keep the following things in mind.
First, this time of year generally has lower sales, the 20 GB model is not even offered in all territories and Sony's bigger games don't come out the door until the second half of the year. Therefore the impact on sales is relatively minor.
Second, Sony has been aggressively cost cutting by doing things like removing chip-level PS2 compatibility, shrinking the internal chips, etc. With the 20 GB PS3 reportedly loosing more more money than the 60 GB version, and the additional cost to manage two separate lines (manufacturing, packaging, shipping, etc), removing the 20 GB PS3 will save Sony money and potentially allow for a price reduction sooner than had both lines been fully operational.
Third, people are buying substantially more 60 GB models than 20 GB. Yes people are arguing that this is simply because Sony is purposefully not creating as many, but this is even more reason to drop the 20 GB model. Sony had to either fully commit to the success of the 20 GB PS3 or drop it entirely. Half-measures are just more costly, distracting and ultimately more confusing for consumers particularly when the 20 GB version is hard to find.
So while on the surface this may seem like a minor set back ultimately this feels like the right decision as we march toward the later half of the year.
I wonder if Microsoft will follow suit and streamline all of their production to a single 360 platform too. They will now have three lines - core, premium, and elite. Interestingly enough, Nintendo is doing the best (for a variety of reasons), but always took the single platform approach.
Time can only tell if Sony will maintain it's dominant position in gaming. After the debacle of the PS3, it may only be salvageable by this new aggressive cost reduction approach and future pricing discounts.
... so said 'Ming' on 04/15/2007 @ 09:28:23 AM [Direct Link]
I doubt MS will drop to a single one. I think most people were hoping the Core would disappear and the Elite would be $400 US with the Premium dropping to $300 US. I would be curious to know the breakdown in numbers that MS has sold for Core and Premium.
As for Sony, I understand why they cut the 20 GB model (they weren't giving it any love, so why keep it), but they have to hope that this doesn't help MS. The Elite now doesn't look as bad from a price standpoint since the jump to the only PS3 model is $120 US. That is two games difference (and you are getting a a bigger hard drive for demos/arcade/etc)...yes I'm staying away from media discussions since they are gaming consoles first.
... so said 'Joseph Molnar' on 04/19/2007 @ 09:04:39 AM [Direct Link]