PS3 to Sell at Over $800 in UK

joe 155 writes "The Register is reporting that ' the PS3 will cost £425 in the UK - over $800'. SCE UK Managing Director Rat Maguire said: 'I don't think it's an expensive machine - I think actually, it's probably a cheap machine. If you think a Blu-Ray player by itself might be £600-700, and we're coming in at just £425, it's a bargain.' Can a console really be viable at this price?"

Change Your Ads Then!

[eldavojohn]

If you think a Blu-Ray player by itself might be £600-700, and we're coming in at just £425, it's a bargain.'

Buddy, if your logic rests upon the consumer thinking about this being a blu-ray player, then you had better change your marketing strategy.

When I look for a gaming console, I don't care if it plays 8 tracks. I want to be able to play fun games and I would like to do it without too high of a price tag. If you want people to buy it for blu-ray functionality, you better market it as such because the gaming & movie crowds might overlap but one is far larger than the other.

And that's not even bringing up the problems me and my friends experienced with first generation PS2s and their ability (or lack thereof) to play DVDs. I haven't played a DVD in a PS2 for years ... now I've learned my lesson and don't care what a console can do aside from gaming.

Do one thing right and don't bloat your hardware please. You haven't had a spotless track record for testing prior to release and more functionality means a lot more testing.

Do you want me to see this as "The Playstation Three" or "The Sony Blu-Ray Player"? Pick one and make a solid product.

Prices of other consoles in the UK

[LoverOfJoy]

So does anyone know how much the Wii and the 360 will cost there? If everything there just costs more then saying $800 is meaningless.

This just in..

[Rob T Firefly]

Extremely Rich Man doesn't think £425 is a lot of money.

In other news, a homeless man retracted his suicide plans upon finding a tenner in the gutter.

Nothing to see here

[AmiMoJo]

This is normal practice in the UK. Our prices are always higher than overseas, it`s nothing new.

They don`t call us "Treasure Island" for nothing. After all, what are you going to do? Buy an import PS3 and UK games won`t work, plus import tax will kill any saving. Go to Europe to avoid region coding and taxes? How many people actually will?

Cheap Machines

[Hairball6494]

I agree with the bit about the machines being cheap. Just think. If you had a desktop with the kind of gaming power these little boxes such as the 360 and the PS3, they'd cost well over $1,000. I'm not buying a console since I sold my gen 1 xBox. I don't think they're worth it. Besides, how many of you can pull yourselves from your computers long enough to play on a console?

Expect the Playstation to underperform.

[Ckwop]

It's not going to stay that price. All the consoles have come down in price relatively quickly. So the question is not whether it is viable but more whether it's a sensible decision.

The way consoles are sold is quite a clever exercise in capturing the consumer surplus; that is, segmenting your market according to their willingness to pay. You launch at a price that is very high to start with and you capture the relatively small segment of the market that thinks your product is really worth that much. You then slowly lower your price so you hoover up more and more of the people who are willing to part with their cash when the price is more reasonable. Eventually, as you near the end of production, you cut your prices further to get it off the shelves and get the people who want something for nothing.

The problem Sony has neglected to contemplate is that this Playstation is not launching in the same conditions as the previous versions of the brand. It is not the first to market with the new generation of console. This is crucial, because now Microsoft is already ahead of the curve with the price strategy I described above. At every stage in the price lowering, we'd expect Microsoft to be cheaper than the Playstation. The Xbox 360 is likely to have more games at any given instant than the Playstation 3.

Another factor here is BluRay. I'd estimate that 80% of Playstation 2s are hooked up to a small TV in some teenageers bedroom. They're not going to go out and buy a High-Definition set for their Playstation 3. They will get no benefit from the enhanced resolution of BluRay and therefore see no reason to buy it.

For this reason, I expect the Playstation to under perform by a long way. It may even cause the Playstation to fade much in the same way the Dreamcast caused Sega to wash out to see. These are interesting times to be alive.

Simon.

Re:Change Your Ads Then!

[Evangelion]

They can't.

I don't think Sony is capable of NOT trying to control a format. The PS3 is simply thier attempt to get an installed base of Blu-Ray players, fast, and beat out HD-DVD. The rest of the company is simply using the PS division to futher thier own ends.

WHY they need to control a format is up for grabs -- it's possible it's just thier culture, or the dogma handed down by the leaders that has been followed for decades. But this is the exact same thing as Beta, MD, Memory Sticks, and UMD -- all of which failed to get any support outside of Sony products.

The PS3 is expensive, but it's the only player in it's domain in Japan -- the Xbox 360 has, somehow, been less successful than the original Xbox over there.

There's also an interesting column about E3's fallout in Japan [next-gen.biz] that makes the next-gen battle much different over there. It's interesting to note that if the PS3 will be bringing demo/content delivery services to Japan, it would be a revolutionary first, given that Japan's gaming landscape is much different than North America's (difference: Nintendo managed to get game rentals outlawed there back in the day. So game magazines have much more clout, which a demo download service could disrupt.)

Re:Change Your Ads Then!

[Rydia]

1) The PS2 didn't cost 400 freaking quid
2) DVD was an emerging standard with a huge and noticeable advantage over the popular storage medium of the time (VHS), while BR is not
3) Sony will lose money hand over fist if people just buy it as a player without games. However, this doesn't happen, because people do buy consoles for games. The entire business model is driven by this fact.
4) Did I mention it cost 400 freaking pounds?!

Not if I don't want a Blu-Ray player

[Bastian]

It's only a bargain if I want a Blu-Ray player.

If I what I'm really looking for is a game console, the added cost for the Blu-Ray player sounds more like several hundred dollars down the toilet.

Re:Change Your Ads Then!

[eln]

The problem is that when the PS2 came out, there was still a significant portion of the population that didn't own a DVD player, so it was a real bargain (especially when decent standalone DVD players at the time were close to $200).

Now, everyone already has a DVD player, and a standalone player can be had for $50. Sure, Bluray is a new technology, but to most people it's just a fancy DVD, and they already have a DVD player. When the PS2 came out, DVD technology had been out for years, and it was in the middle of the transition from "early adopter" product to "mass market" product. Bluray hasn't even really come out yet, and is still in the very early stages of the "early adopter" market.

Basically, while Microsoft and Nintendo are offering game consoles that immediately appeal to the mass market, Sony is putting in a very expensive cutting-edge technology that pretty much guarantees their primary market will be the affluent early adopters. While this is certainly a viable market, it's a much much smaller one. While this may not matter in commodity electronics, in the gaming industry, where the number of units you can sell has a major effect on how many developers make games for your platform, shooting for such a small market can kill a console before it ever gets off the ground.

Re:Not that expensive

[sqlrob]

And how successful were those consoles?

Re:Change Your Ads Then!

[iainl]

"I bought a PS2 because I wanted to play games, but also because I wanted to play DVDs. The PS2 does that well enough, right?"

In a word, no. At least in the UK, they deliberately crippled the player by only allowing it to output DVDs in composite. By quite a large margin, the PS2 is the worst DVD player I've ever had the misfortune to watch.

Now, having discovered this last time, why would I hand over £425 (£425!!!) for the follow-up on the grounds that will output BluRay images. We already know that they've crippled the audio output to DVD quality, why expect the picture to be any better?

Re:Not that expensive

[rizawbone]

Remember the Neo Geo and 3DO, they were well over $800 (with inflation adjustment)

Yeah, and now both companies are bankrupt.

The UK != The US

[Lave]

I have a couple of points to make about how they are marketing it as a cheap way to get a blu-ray player. This worked brilliantly for the PS2 in the UK. In the same way we all told our parents we needed a PC for "homework" when growing up. This won't work for a number of reasons.

1) DVD -> Blu-Ray != VHS -> DVD. VHS were terrible. Crappy quality and wore out fast. DVD players let us use our current equipment to get much better picture quality. It was a one purchase upgrade. And it's only become universal in the last few years (now that a dvd player is £30). With Blue-ray moveis I need a new TV or it's meaningless. And a new TV will never reach £30. most people won't upgrade till our current TV breaks.

2) PAL != NTSC. When I've been in america I have to say - the picture quality is terrible. I can see the desire for HD television there. But in the UK we have very good quality broadcasts. There is less desire for the upgrade.

3) Freeview. This - in my opinion - is the clincher. Our normal terrestial broadcast (channels 1-5) is the primary method of recieving TV. This will be shut off between 2008 and 2010 to replaced with the currently available "freeview" this provides 30-40 free channels for the price of a set top box. There is much annoyance about this - even when set top boxes are only about £30. "Freeview" doesn't have the bandwidth to provide HD content. So knowing that cable channels in the UK have always been niche, there is no way that people will be willing to upgrade from freeview till at least 2010.

To me, this suggest that these consoles are a generation early with HD in the UK. And this should have profound effects. In my opinion of course.

Re:Typo of the Century!

[VJ42]

Execpt sitting right next to it will be Nintendo's offering at around £200 (probably nearer £150 or £175). I know which one I'm gonna buy, I had the same choice when I went into the shop and saw the PSP bundle at £270 and the DS bundle at £120. I chose the DS, people will buy the Nintendo, especially as it's going to come out at more than 1\2 the price in the UK, and about 1\3 the price in the US

Why would I have a problem?

[Moraelin]

"Besides, how many of you can pull yourselves from your computers long enough to play on a console?"

*raises hand*

If I'm going to play a game anyway, why would I care that much if I sit on this chair in front of the computer or on that sofa in front of the TV? No, seriously. I'm there for the game, regardless of whether it's a computer, console, or a magic Ouija board with a LCD screen.

Seems to me that some people get so focused on the means, that they lose sight of the goal. The computer is not the goal, and the console isn't the goal either. They're just _means_. Playing a good game is the goal.

That's it. That's what being a "gamer" is all about: games. Nothing else. Everything else is in some other category. And let me recap it, for those who still don't get it:

- E.g., those just wanting to brag about how many more 3DMark points their new 7900 GTX scores than my PS2, those aren't really looking for the "gamer" category. I don't play 3DMark, I play games. For that kinda discussion, that's over there, through the door labelled "willy wavers".

- E.g., contrary to popular belief, stupid fanboy wars about Nintendo vs Sony vs Microsoft aren't "gamer" stuff either. The brand name isn't a goal, and anyone who has serving Nintendo or Sony or MS as a goal really needs to take a break and a critical look at their life. Again, playing a good game is the goal. Owning a Nintendo or a Sony or a MS console or a PC is merely a means to playing the game you want to play, nothing more.

- E.g., no, as a gamer I don't give a flying fuck about the controller being with/without vibration, banana shaped, nunchaku shaped, mouse+keyboard, or whatever, either. That's just means too. Will there be a great game that requires that controller? In some cases, I seriously doubt it, but the final judgment will be actually seeing that game on the shelves, or not. Then I'll go and buy the right controller for it too. (I had no problems buying lightguns for lightgun games, or a Dreamcast keyboard for chatting in PSO, after all. But again, those were the means, not the end. The purpose was the game, not the lightgun.)

Will I buy a PS3 or a Wii or an XBox 360? Hell if I know. Maybe all three, maybe neither, maybe something in between. Depends on whether any of them will have enough games I really want to play. If they have the games, sure, sign me up. If not, not. It's all about the games, in the end, everything else is just means.

And again, if a game I want to play is only on a console, I'll have no problem getting up from the computer and moving over to the console. Why wouldn't I? Doubly so if the whole genre doesn't even exist on the PC. (When was the last time there was a fighting game for the PC, for example?)

Re:+1 insightful

[robthebob]

You say we let ourselves "get screwed so hard" and "they just do not get it" but what can we actually do about it? We know the prices are significantly higher, for no good reason, but we still have to pay them if we want the product. American companies enjoy getting their free 30% markup over here, and they even charge more here than Europe, despite the fact that they don't even need to do any translation here.

But here's the thing

[sterno]

People will buy the PS3. In fact, a lot of people will buy the PS3. The price is high yes, but not so high that it's pricing people out of it. Yes, 425 pounds is $800, but then the dollar has been tanking.

Are people going to buy PS3 as a blu-ray player? No. But then that's not the point. The point is that when movie studios are looking to support HD-DVD or Blu-Ray, and there's already millions of Blu-Ray players out there because of all the PS3's, what are they going to choose.

Practically speaking very few people are out there are buying HD-DVD or Blu-Ray right now. Most people I know don't even have HDTV yet. Of those that do I can't imagine many of them shelling out $800-1000 for a HD movie player yet. However, of those people I can imagine many of them buying a PS3. They won't buy it to be a player, of course, but hey, if it will play those, why shell out the money for an HD-DVD player when you've got a Blu-ray player sitting in your living room already.

It's going to be probably 3-4 years before either HD format becomes vaguely mainstream. DVD players are dirt cheap right now and since most people don't have HD, it's not worth investing in the format (especially if all the HD players will be backward compatible with DVD's). However if you have a PS3, expect to upgrade to HD at some point, and have a choice between a Blu-ray and a DVD version of a movie, why not get the higher quality now? Then you won't feel a need to upgrade later.

The PS3 will be expensive relative to what's out there now, but people will buy it. And because it'll be in millions of living rooms unlike HD-DVD players. Sony's probably losing a fair bit on the PS3 but if it lays the ground work for winning the format war on HD video, they'll be rolling in the licensing fees for at least a decade.

Re:Expect the Playstation to underperform.

[kamapuaa]

Worldwide sales figures will look something like this over the next five years:

PS3: 120-150 million
Wii: 20-35 million
360: 12-18 million

Ha Ha HA...oh wait are you serious?

Re:Change Your Ads Then!

[Xugumad]

A few points:

• The PS2 came out at £299, not £425 (or, as I like to call it, almost 50% more).
• DVDs had been out for several years, and not only were an established format, had a sizable catalogue available (1,000+ titles, I believe). Blu-Ray will have been out for a few months, with a catalogue best measured in dozens.
• DVDs showed a clear advantage over the previous format, on almost any TV. Blu-Ray shows a noticable advantage (and even less noticable if you've ever tried an upscaling DVD player) on HDTVs... which are still in the minority even in the US, and very much in the minority in the UK.

Re:Change Your Ads Then!

[archen]

It's also amazing that Sony still hasn't learned it's lesson. But there's a reason for that. This is a case of left hand vs right hand. The hardware engineers make various stuff, but continually have their hands tied behind their backs by the "content" people, or someone else at Sony with another agenda. Each time it is the hardware division that pays the price for everyone meddling in their affairs.

Sony is a company with a good hardware division that implement rather innovative products. I'm sure when they drew the PS3 up they said a Bluray player was fine but as it came to crunch time they wanted to dump it. Yet I'm willing to bet it's the 'content' people who wanted to force BluRay down everyones throat and forced them to put it in and jack the price up WAY too high. The content people are DEMANDING their DRM, and again this is going to fuck over the hardware division of Sony.

At this point the best thing this company could do is split. Cut out the cancer that is Sony records/film and let the hardware people make products that WORK without being crippled. Personally I feel this works to my benefit because with BluRay fighting HD-DVD it's likely that neither will win and DVD will stay; which is exactly the result I want. Go Sony!

Re:Change Your Ads Then!

[hattig]

about 5 years ago the dollar-pound rate was around 1.4 dollars for a quid.

So £400 would have been $600.

Now it's around 1.9 dollars. £400 would be $760.

Of course, the PS2 launched at $299, I think it launched at £279 over here ($530 with today's exchange rate). That means that in the UK at least, people were willing to pay around $500 for a console (taxes included). If the $499/$599 prices were converted to pounds sterling fairly, they would cost around £329/£389 over here, including tax. The fact that they want to sell the machine for much more than that shows they're being greedy and yet again treating the UK as Treasure Island.

However, from that you can see that if people were willing to pay £279 5 years ago for a PS2, then they'd pay £329 today for the low-end version, it's a 'mere' £50 more. However I don't see them paying £100 more.

Re:Change Your Ads Then!

[barawn]

DVD was an emerging standard with a huge and noticeable advantage over the popular storage medium of the time (VHS), while BR is not

And, of course, DVD had already proven that it has a market - that is, there were people willing to pay $250-300 for a DVD player.

Blu-ray drives aren't on the market yet. They might debut at $1000, but if no one buys them there, someone's gonna have to work real fast to drop the price down.

I sure as hell wouldn't buy a glorified DVD player for $1000.

Of course, I do wonder if the PS3 will suck as much as a Blu-ray player as the PS2 did as a DVD player.

Re:The UK != The US

[hattig]

It's probably the SCART connector between the player and the TV that's showing the good picture quality for PAL vs NTSC. SCART (Eurotel) carries RGB signals, which are far better than composite (although SCART also carries composite in case the TV is cheap and only has 1 RGB compatible SCART input). SCART's been standard in the UK for around 20 years too, so everything has it (apart from the PS2, if the PS3's the same then it can sod off back to Japan).

PAL (Picture Always Lousy) was only lousy with analogue terrestrial broadcasts. We've had satellite TV here in a big way since 1989, and digital satellite since 1998 (MPEG2, standard definition). We've simply had better source quality all the way to the TV than NTSC. And that has meant that HDTV uptake over here will not be because of a burning need to improve picture quality, it'll be merely because at some point you won't be able to buy a standard definition set.

Re:Typical

[drinkypoo]

The discussion is about whether or not a console can be viable at a given price. The pricing of the competitors is entirely material. The above commenter may be a fanboy, but you're an ass.

Re:Prices of other consoles in the UK

[ThousandStars]

Before you get too bent out of shape, remember that VAT is mandatory in the EU and adds 17.5% (IIRC) to every purchase. Imagine if every state with sales tax in the U.S. had to post the actual price instead of dinging you at the register and you'll be closer to the EU and British schemes.

What you technically get for the $ doesn't matter

[King_TJ]

I think you have to look at the psychology behind console sales. The buyer wants a fun gaming experience, and the ability to pay for the whole thing piecemeal.

Why didn't you see PS2's bundled with a 5 or 10 pack of games, or even including a memory card and 2 controllers, right in the original box? Simple! Because the typical consumer feels much more comfortable shelling out, say, $600 as $200 here, another $50 here, and maybe $90 there, etc. until reaching that $600 total, rather than bam - $600 up-front.

I barely know *anyone* who uses a PS2 who didn't buy that 2nd. controller and a memory card, and owns at least 5 or 6 game titles! Yet almost none of them would have paid for all of that in one box, even if it was discounted a little bit as a bundle!

This is going to be the PS3's problem too. Even if consumers *do* wind up wanting blue-ray players shortly after the thing is released, and feel it's a good value for all the cool games it plays, plus the blue-ray capability - they won't want to swallow the whole cost up-front. It'll just feel like too much of an investment in something that's far from a necessity.

If Sony wants successful adoption of these units, and this really is close to the cost to build 'em, they're going to have to take a big loss up-front on the sales, and find a way to nickle and dime the buyers on all the "must have" extras and games so they can make it all back in the long-haul.

But.... VHS sucked

[popo]

That's why DVD inclusion in the PS2 wasn't a dumb idea.

DVD's were a massive leap over the pathetic quality (and "sequential access") of VHS.

By contrast, DVD's don't suck. So Sony, if your potential market is people who have HD Televisions AND want to be early adopters of unproven media AND don't mind waiting for a meaningful list of available titles to become available AND don't mind shelling out goofy amounts of cash per title... then congratulations on your "niche".

For a second there we thought you guys were trying to make a mass market product.