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Analyst embarrassed: says non-Blu-ray PS3 incoming

Wednesday, 25 Feb 2009 11:44
PlayStation 3
Industry analyst Mike Hickey of Janco Partners believes a PlayStation 3 price-cut is imminent. He embarrasses himself by claiming that it'll be the removal of the console's Blu-ray drive that'll help Sony make the cut.

In his latest industry note and posted on Gamedaily.com, Janco Partners analyst Mike Hickey reveals that a PlayStation 3 price-cut is probably-maybe on the way. He states that "recent channel checks indicate increased speculation for a PS3 price cut announcement from Sony in the next couple of days."

This in itself isn't laughable. I personally agree that all signs point to a PlayStation 3 price-cut sooner rather than later. In fact, I argued that April 2009 would be the perfect time for such a cut.

April will mark the end of Sony's 2008 fiscal-year, meaning a price-cut won't impact the Games Division's 2008 profits. A cut is likely to occur after March 31st since the company can make their losses up during the 2009 fiscal-year.

Unlike Hickey though, I don't believe the announcement will come in the next few days. Not only for the above reason, but because Sony will want to corner Killzone 2 consumers that will buy the console especially for the game. After they've made the jump, the price-cut can attract a whole new set of buyers.

However, what do I know? I'm no analyst! Hickey is, and he believes that the cut has already been brought to the attention of retailers:

"Sony is meeting with retailers this week in Phoenix, where SCEA is holding its annual Destination PlayStation conference. We think the company needs to reduce the current price by $100 to effectively restart unit velocity at retail."

This is perfectly fine, but Hickey believes that Sony will afford the cut with the following strategy:

"We are also hearing continued speculation that Sony is working on a non-Blu-ray PS3 console, which could enable them to make the aforementioned hardware price reduction."

A non-Blu-ray PlayStation 3? Riiight. That'd make sense, since who wants to buy a PlayStation 3 that plays Blu-ray films and...PlayStation 3 games!?

Perhaps Sony will begin releasing PS3 games on DVD's and Blu-rays. Or perhaps they're ahead of the game and will releases all of their titles digitally. Still, that leaves all previously released PlayStation 3 games in the lurch. 'Hey, buy the new cheap PlayStation 3 that can't play Metal Gear Solid 4, LittleBigPlanet or Killzone 2!'

What's a PlayStation 3 without a Blu-ray drive? Since it can't play PlayStation 3 or PlayStation 2 games - it's simply a PlayStation 1 that can play DVDs. Splendid. I'll buy one of those for £40 please. Now that's a price-cut!

Nonetheless, Hickey does make a reasonable point by stating the obvious:

"We believe the market is expecting a PS3 price cut in April or by June (E3) at the latest, so a near term aggressive pricing decision by Sony could provide a positive catalyst for video game related stocks including GameStop, Activision and Take-Two Interactive.

"If Sony does not cut the price of their console, we expect the continuation of languishing PS3 hardware sales and the potential for publishers to accelerate their reallocation of resources away from the PS3 console."

It's a harsh warning to Sony, but we doubt they'll be removing the drive from the console that won the high-definition format war.

I also thought I'd bring your attention to an article from our friends at D+Pad magazine. Published in November, the article correctly details the God of War III trailer shown this month, as well as the existence of PSP versions of MotorStorm and LittleBigPlanet, which were only announced yesterday.

The significance of the article is that it also states that Sony will get more competitive on the PlayStation 3's price from March 2009 onwards. So don't be surprised when the cut comes at the end of next month.

Patrick Steen



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  • "PS3 without blu-ray? Blu-ray was one of the reasons I bought a PS3 over a 360, so I think Sony would be silly. Removing blu-ray would make the console cheaper - but at the expense of one of it's main selling points. One possibility, like Microsoft did with the original xbox, Sony might just disable the blu-ray functionality and reduce the price - and make people buy a dongle or pay for software that enables the blu-ray feature for those that want it. I hope they don't take that route but who knows. Personally, I think Hickeys report of a new PS3 without blu-ray is a load of rubbish, but it makes for a good read."

    Dantendo64 (Woking, UK) Posted: 25/02/2009 14:57:29

  • "I guess removing Bluray would mean, removing Bluray movies support, so that it does not have to pay license fees and all that crap to Bluray foundation"

    yo (Mumbai) Posted: 25/02/2009 17:20:23

  • "I don't think anyone is getting the point here. No Blu-Ray no games. PS3 Games are on Blu-Ray discs. Get it? That's why the sh*t is absurd."

    Guano (US) Posted: 25/02/2009 17:30:45

  • "Dante: "Sony might just disable the blu-ray functionality and reduce the price." How exactly would that help Sony reduce the manufacturing price? Producing a Blu-ray drive and then disabling it in the console? That doesn't let Sony save on the manufacturing price."

    Patrick (Gamezine) Posted: 25/02/2009 17:35:21

  • "@Dantendo ur idea does make sense, however there might be a few flaws. if sony does keep the blu-ray drive and charge to activate it....then sony would be making a loss with people who dont want to activate it,coz sony is putting the drive in the ps3 anywayz. and if everyone would want to activate their blu-ray drive, it wouldnt be cheap,would it?coz it is the main gaming aspect...so sony would want to charge a hefty amount for that....in that way the price is going back to $399, which is the current price. fine it might not go up that high, but if u want to keep the drive and finally after the activation charge give about a $40 price cut, why do it anywayz?this would reduce the risk of the people who dont want to activate their drive (which is completely insane).Hence, sony can just keep everything the same and make a $40 - $50 price cut. i am only saying this regarding to the given scenario by dantendo. of course i would love the ps3 price to go down, not tht i dont have a ps3, but that i just want the ps3 community to grow so that i can play all those skilled players out their. psn: sourav-93"

    sourav93 (UK) Posted: 25/02/2009 17:51:12

  • "Sony IS the Blu-Ray "Foundation""

    Shadow (MN) Posted: 25/02/2009 18:06:29

  • "@Dante - disabling the blu-ray drive wouldmt save Sony money in manufacturing the PS3 and it would also mean you cannot play PS3 games until you activated it. Also as there is no BC it means you would simply be buying a glorified PS1 unless you activated blu-ray. The analyst who could honestly believe Sony would bring out a non-BR PS3 is an idiot."

    ry2k09 (UK) Posted: 25/02/2009 18:12:58

  • ""non-Blu-ray PS3"... Ha, Ha, Ha.. Bad Joke! BTW PS3 doesen`t need a price-cut. If you ask me, the PS3 is still the best and the cheapest Blu-Ray player outthere!!! (proud owner of 60Gb launch PS3 now 500Gb bigger ;-)"

    DanteKoRn-7 (Croatia) Posted: 25/02/2009 18:40:38

  • "This is a bs story what would the point of selling a ps3 that doesnt even play its own games? There will be a price cut but they wont cut out the drive that the system works on."

    Stephen Struss (U.S.) Posted: 25/02/2009 19:05:13

  • "I swear. I don't think analysts that analyze the video game industry actually understand how consoles or games work. Do they realize that PS3 games are ALL on blu-ray disc? This isn't the PS2 where, as a developer, you could choose between CD or DVD. Come on people! No blu-ray drive means you're either going to release new games on tons of PS1 CD's, digitally or add in support for PS2 games and release them on DVD's. Then RE-RELEASE old PS3 games digitally and on CD/DVD as well. Come on! Might as well release a whole new console!"

    Greg (PA) Posted: 25/02/2009 20:54:14

  • "Industry analysts have also confirmed that inside sources believe in the possibility that maybe this will be the year MS CEO Ballmer will be replaced by an overweight leprechaun."

    Raz (Toronto) Posted: 25/02/2009 22:25:54

  • "You all COMPLETELY MISS THE POINT of this article. YOU CAN NOT REMOVE BLU RAY from the ps3. it would no longer be able to play the ps3 GAMES. Thats somewhat nessesary in a GAMING console. Come on people. Act like gamers and not just internet lurkers."

    Your all simple. (Idiotville, obviously) Posted: 25/02/2009 22:30:39

  • "you guys got to admit it. sony is circling the drain. they failed with the psp and now same thing with the ps3. there aren't very good games out for it, and yea, relying on the blue ray drive to keep the price up is pretty stupid. i've been a sony fan since playstation 1 and 2, but the ps3 is worse off then the WII. they're more worried about hardware then putting out actually good games like 360 or broadning their audience like the WII. maybe they'll get something right with their next console....as long as they don't try any more hand helds."

    AbsintheEye (USA) Posted: 25/02/2009 23:23:24

  • "Uhmm...I think this guy SHOULD be embarassed. Playstation 3 games are on Blu-Ray discs, so a Playstation 3 without games is basically just a....Station. Lame joke is lame =/"

    Kris (Somewhere clueless) Posted: 25/02/2009 23:29:06

  • "thats f**ken stupid i dont think that sony would remove the blue-ray drive and if they did it would be so dumb.... they are gonna have to make non blue-ray games and is going to cost them even more money because they are gonna have to make to different games a blue-ray and a dvd...... i dont think they are going to do that"

    X3R0X (CA) Posted: 25/02/2009 23:42:17

  • "Remove the blueray and youve got a console that plays cd's and dvd's which would make it an expensive DVD player who in their right mind took the time to write this?? I dont know why you think that removal of a blueray would make people want to buy it but i think you need to realize as Guano stated no bluray no games plain and simple and noone wants to purchase a 200 dollar dvd player sorry digital downloads are pheasable but removal of the bluray would mean expansion of the Hard Drive to store the games downloaded youd be "robbing peter to pay paul" in that instance and it wouldnt work on the other hand if you cut down the size of the Hard Drive that would be more likely think before you waste your time writing articles next time please"

    Daddylumpkins (manila,philippines) Posted: 26/02/2009 02:58:44

  • "It wont happen. Why fight for a format which more than a year later you have to remove anyways just to make a better impact?? Bullsh*t"

    WitWolfyZA (JHB, RSA) Posted: 26/02/2009 07:13:34

  • "Daddylumpkins: Guano actually agrees with me. I thank you for your comment, but I do wish you'd have read the article:

    "What's a PlayStation 3 without a Blu-ray drive? Since it can't play PlayStation 3 or PlayStation 2 games - it's simply a PlayStation 1 that can play DVDs. Splendid. I'll buy one of those for £40 please. Now that's a price-cut!"

    Most of you are kindly backing up my opinion on the matter by repeating what I said in the article. Cheers."

    Patrick Steen (Gamezine) Posted: 26/02/2009 10:26:55

  • "What would have been smart in business last year or in previous years isn't exactly what's smart in business right now. When the ship starts sinking you don't wait until the "perfect moment" to start bailing...Sony needs to start bailing now. "

    Ray (http://electronictoyroom.com) Posted: 26/02/2009 17:14:44

  • "Sony can reduce prices because of chip size reduction costs that make it easier to redesign the system board to make it less expensive. Look at the new 40GB & 80GB models that don't have the PS2 BC. They redesigned those system boards to reduce the CPU size and removed one of the firmware chips and moved those files to the HDD, so if you upgrade your HDD with those systems you need a copy of the installed firmware version on media other than the HDD. And they are looking at 45nm chip sizes for both the Cell and RSX chips which reduce heat and allows for other changes to the system boards to reduce costs."

    Mark (Yakima, WA USA) Posted: 05/03/2009 06:39:41

  • "Damn straight! What is a playstation 3 without blu-ray and can't play PS3 games, oh yes... it is a PS2... i think the whole concept of sony removing blu-ray from the Playstation would be more than silly owing to the fact that it is one of the key factors that sell the console in the first place!"

    Ninjitsu182 (South Africa) Posted: 11/05/2009 14:31:40

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