Blue Ray Price Drop Means possible Price Drop for PS3

[Momma Bear]

Sony's Blu-Ray cost cuts prompt talk of lower PS3 price tag



By Ben Charny @ marketwatch

Last Update: 6:56 PM ET Jun 4, 2007




SAN FRANCISCO (MarketWatch) --

Sony Corp said Monday it can now make Blu-ray video players more cheaply, sparking speculation the electronics company will cut prices of its PlayStation 3 video game console and other products that include the technology.

"If the cost of Blu-ray is coming down, you can drop the price of anything with Blu-ray in it," said Arvind Bhatia, an analyst with Sterne Agee & Leach Inc. Sony said cheaper component costs and production "efficiencies" make it cheaper to manufacture Blu-ray, which is named for the blue-colored light used to read data stored on discs. The technology's being positioned as a better alternative to the popular DVD format.


Sony's already announced one price cut based on its newfound Blu-ray chops. On Monday, a company representative said it will begin selling a new version of its Blu-ray video disc player later this week for $500, which is $100 less than what it previously said it would. The next Sony product expected to have its price cut, say analysts interviewed Monday, is Sony's PlayStation 3 gaming console, which comes with a Blu-ray video player.
While Sony makes scores of different devices, its PS3 is among its highest profile product lines, and has become much more important to the company's bottom line.


Any price cut is sure to boost PS3 sales, and sales of games designed for the console, Bhatia said. According to NPD Group, at least 1.3 million PS3s have been sold. That nearly half of the total sales of Nintendo's Wii consoles, and about a quarter of the 5.4 million Microsoft Corp.'s Xbox 360 consoles that have been sold.


At $700 for some models, the PS3 ranks as the most expensive of the best-selling devices. The hefty price tag has helped to throttle sales since its introduction last year. Meanwhile, Nintendo Co.'s (7974.OK) Wii console, which costs around $250, has become a big hit. Microsoft Corp.'s ([Only registered users can see links. ]Microsoft Corporation Xbox 360, which costs between $300 and $400, has also experienced strong sales.



"Feedback from retailers continues to indicate that a price cut on PS3 will be important," Bhatia said. Speculation about a PS3 price cut have been swirling since March, when the company began first dropping hints of new efficiencies in its Blu-ray manufacturing.At the time, Goldman Sachs analyst Yuji Fujimori speculated Sony will be cutting PS3 prices by $100 in time for the Christmas holiday sales buying season.


Sony's shares recently traded at $56.56, down from the Monday close of $56.70.

[QueenB]

Hopefully they will bring down the price. Im not holding my breath though - price has already dropped since launch (in Europe at least) so I would expect Sony to cling on to the price for a little longer.

[Momma Bear]

Originally Posted by QueenB

Hopefully they will bring down the price. Im not holding my breath though - price has already dropped since launch (in Europe at least) so I would expect Sony to cling on to the price for a little longer.

Yeah just Europe, but if it drops to the right price here. And or I can get a refurbished on I will probably buy one. But at the moment it's too expensive for me. And I probably won't be allowed to get one anyway. I couldn't buy the 360 after I bought my Wii Guess who wears the pants in my household?

I would have to sneak and buy it and be like Oh look!!! Santa came early But if they drop it even further in Europe, wouldn't you be tempted?