Pachter, analyst, expects PS3 price drop around April

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Godzirra!

Wedbush Morgan Securities analyst Michael Pachter (try saying that when you are drunk) has said that he expects a Playstation 3 price drop by April this year. He then specifically predicted that the 80gb PS3 SKU would drop by $100. He added, “Once the PS3 is at a more affordable price point, we think that sales of that device will once again begin to grow.” (via 1UP)

Pachter also said he expects the Xbox360 premium SKU to drop in price by $50,  so the PS3 still wont have any upper hand even after such a drastic price drop.

Analysis after the jump.

A price drop of 25% would surely boost the sales of the PS3, but to what cost? The current manufacturing cost is about $440 so Sony would make a loss of $140 per unit. Sony is no stranger to making a loss per unit but given their current financial situation is it a wise idea to pin the hopes of turning a profit on PSN and software? Yes, at the current price they are making a $40 loss but that is easily negated, or easier than $140.

If I were Sony, I would carefully consider:

  • The date of the price drop, so it avoids the Xbox360 price drop (and subsequent media storm) to maximise sales.
  • By what price it drops, to keep expenses under control.
  • What software launch it should coincide with, to generate the maximum effect and sales.

Sony and the Playstation brand are in a very interesting space where the pressure is on to make a big impact in the market that is being dominated by the Wii, and the Xbox360. So, 2009 will be an interesting year for the Playstation 3. I don’t even think the PSP is relevant anymore, except when a title with ‘Final Fantasy’ is released.

Ironically, Chris Pereira (author of the source article) stated, “Quite a fuss has been made over the price comparison chart Sony released last week which pitted the PS3 against the Xbox 360 and Wii in a comparison of value.” It seems that chart has made a fuss everywhere.

Source: 1UP

Last Updated: January 14, 2009

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