PS3 price drop announced for N. America; new SKU revealed
Tuesday 10th July 2007, 11:11:00 AM, written by Carl Bender
Sony has announced that effective immediately, the price of the 60GB
Playstation 3 has dropped to $499 in the United States; Canada has
received a drop as well, taking the system to $549 in that country.
Though officially denied by Sony just days ago, the cat was let out of
the bag when a recent Circuit City circular containing the new price
was leaked last week, and the move was largely expected in spite of
the later denial.
The timing of the price cut lines up also with the start of a promotion granting five free Blu-ray films (by mail-in offer) to purchasers of a new Blu-ray player (inclusive of the PS3). This offer increases the potential perception of value, and is aimed in part at promoting consumer awareness of the Blu-ray high-definition format at a time when the Playstation 3 will be generating a lot of attention during E3.
In conjunction with the expected price cut, Sony managed to surprise with the tandem announcement that beginning this August, a new Playstation 3 bundle featuring an 80GB console will go on sale for $599. Matching the specs of an until now Korea-only PS3, the new 80GB SKU will excise the EE+GS@90nm and rely on software emulation, as is presently the case in the European model. In addition to the console itself, the game Motorstorm will also be included in the bundle.
Although the value proposition of the 20GB increase in hard drive capacity and bundling of a first-party title for a $100 premium over the standard 60GB unit may not be readily apparent, Sony is likely hoping that it will be enough to lure a segment of the potential PS3 buying population upon its launch in August. Enjoying manufacturing costs in fact lower than the present NTSC 60GB unit, and with a game that costs little to include for Sony, the margins derived from sales of the higher-end bundle will help to offset higher losses associated with the discount of the standard version.
What can be defined as "standard" in terms of the PS3 is itself a moving target, with the 60GB unit not too long ago being considered ''premium'' relative to its quickly-discontinued 20GB sibling. The incremental movement in hard drive capacity - and speed of introduction - also point to what may be an accelerated revision schedule for the console within SCE. As hard drive prices come down quickly relative to their predecessors, it will cost Sony essentially nothing to improve capacity as time goes on, and in fact lower capacity drives on the trailing edge can tend to cost more to source as twilight sets in on their OEM production runs. Likewise, the nature of many of the components in the Playstation 3 lead to a scenario in which cheaper and smaller versions of existing componentry will make themselves available with above-average frequency during the early years of the console''s life.
As such we may see a trend begin to form where in anticipation of a general price cut, old stock is reduced in price to clear the channel, while newer "premium" versions of the console are introduced at a higher price-point for margin buffering. Likely at this time the standard 60GB unit on sale in N America has ceased production, with millions left to sell into retail. Once these stocks are dried up at the $499 price-point, it would be expected that the 80GB (sans bundle) would then move down to occupy that price rung; concurrently, Sony might introduce a new version of the console with a higher hard disk capacity and new bundling scheme in order to take advantage of new efficiencies on the production line.
The timing of the price cut lines up also with the start of a promotion granting five free Blu-ray films (by mail-in offer) to purchasers of a new Blu-ray player (inclusive of the PS3). This offer increases the potential perception of value, and is aimed in part at promoting consumer awareness of the Blu-ray high-definition format at a time when the Playstation 3 will be generating a lot of attention during E3.
In conjunction with the expected price cut, Sony managed to surprise with the tandem announcement that beginning this August, a new Playstation 3 bundle featuring an 80GB console will go on sale for $599. Matching the specs of an until now Korea-only PS3, the new 80GB SKU will excise the EE+GS@90nm and rely on software emulation, as is presently the case in the European model. In addition to the console itself, the game Motorstorm will also be included in the bundle.
Although the value proposition of the 20GB increase in hard drive capacity and bundling of a first-party title for a $100 premium over the standard 60GB unit may not be readily apparent, Sony is likely hoping that it will be enough to lure a segment of the potential PS3 buying population upon its launch in August. Enjoying manufacturing costs in fact lower than the present NTSC 60GB unit, and with a game that costs little to include for Sony, the margins derived from sales of the higher-end bundle will help to offset higher losses associated with the discount of the standard version.
What can be defined as "standard" in terms of the PS3 is itself a moving target, with the 60GB unit not too long ago being considered ''premium'' relative to its quickly-discontinued 20GB sibling. The incremental movement in hard drive capacity - and speed of introduction - also point to what may be an accelerated revision schedule for the console within SCE. As hard drive prices come down quickly relative to their predecessors, it will cost Sony essentially nothing to improve capacity as time goes on, and in fact lower capacity drives on the trailing edge can tend to cost more to source as twilight sets in on their OEM production runs. Likewise, the nature of many of the components in the Playstation 3 lead to a scenario in which cheaper and smaller versions of existing componentry will make themselves available with above-average frequency during the early years of the console''s life.
As such we may see a trend begin to form where in anticipation of a general price cut, old stock is reduced in price to clear the channel, while newer "premium" versions of the console are introduced at a higher price-point for margin buffering. Likely at this time the standard 60GB unit on sale in N America has ceased production, with millions left to sell into retail. Once these stocks are dried up at the $499 price-point, it would be expected that the 80GB (sans bundle) would then move down to occupy that price rung; concurrently, Sony might introduce a new version of the console with a higher hard disk capacity and new bundling scheme in order to take advantage of new efficiencies on the production line.
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