When the PS3 launched in late 2006, Sony was gambling on a console that many gamers had already written off for its high price point. As a result, the company took a substantial loss (almost 3.5 million dollars) in the first two year's of the PS3's life.
With the PS4, however, Sony is hoping to do much better out of the gate. And they should presumably do so based on early pre-order numbers and gamer reaction to the PS4 thus far.
Luckily, Sony isn't willing to survive on fan enthusiasm alone; they have actually lowered their development costs for the PS4 as compared to the PS3. And that's even with the PS4's relatively low launch price of $399.
Of course, that isn't to say Sony won't lose money when the PS4 launches, but, as CEO Andrew House explains, his company "will not generate anything like the losses [they] did for the PlayStation 3." These days it's hard to develop a console and turn a profit out of the gate — just look at Nintendo and the 3DS — but Sony is presumably hoping to get back in the black much sooner than they did with the PS3.
A lot of those operating losses in 2006, though, likely had a lot to do with the PS3's unique system architecture. The Cell chip alone had to be a pretty high expense, regardless of any other system costs like backwards compatibility or memory card ports. In fact, even after Sony introduced the much-cheaper-to-produce PS3 slim, the company was still taking about a $40 loss per system.
The PS4, on the other hand, is built using more common PC-based parts (RAM, GPU, CPU), albeit with some unique features. Not only do these parts help keep costs down, they also make it easier for multiplatform developers.
It won't be until December at the earliest when we start to see just how well the PS4 is selling, but if early scuttlebutt from gamers is any indication, Sony is in a good spot. If they keep costs low, and they continue with consumer-friendly initiatives then things should turn out much better than the PS3.
Do you think Sony's sales for the PS4 will be stronger than they were for the PS3? Can you see them taking a loss during the initial launch phase?
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Source: Bloomberg