The PlayStation 3 has lagged behind the competition in the previous years, at least in terms of hardware sales. To see if analysts believe 2009 would be any better for the PlayStation 3 EndSights contacted three premiere video game analysts to get their views on the issue. We asked them one, multi-leveled question.
- Do you feel that Sony’s 2009 software lineup will translate into brisker hardware sales for the year?
- In your estimation, how big of price reduction will Sony place on the PlayStation 3 for the year? Is what you believe the price cut will be big enough, and if not, how much do you feel is needed to be lopped off the price of the system to make it more competitive in the marketplace?
- Any other general comments, predictions and what have you on the PlayStation 3 system in 2009 are welcome.
Note: The second question was modified for Michael Pachter, who had already predicted a $100 price cut.
Michael Pachter, Wedbush Morgan Securities:
“I think Sony’s success this year will be a function of price first, and Blu-ray adoption second. Lineup is a distant third consideration, mostly because exclusives are far less important to the masses than to hard core gamers, and we’re entering the mass market phase of the console cycle.
It’s hard to pick the “competitive” price point, given that the other two consoles will likely not stay in place. Sony has to get within $100 of the Wii to justify its price to consumers, and has to be within $50 of the $360. They probably won’t really cut in April (that was my early April Fool’s joke), but they should seriously consider making a move as soon as they can afford it. My guess is that they’ll be able to afford a cut by October, and will cut earlier than that in anticipation of their cost of production coming down. I picked April as the beginning of the fiscal year, but it could be June (E3), September (TGS), holiday, or not at all. If they don’t cut, they had better prepare themselves to run a distant third in sales once again.
Frankly, I think $299 is a sweet spot, as it is $100 above the old sweet spot for a box that has Internet connectivity and high-definition video playback built in. Those features are certainly worth something, and consumers aren’t completely oblivious.”
Colin Sebastian, Lazard Capital Markets:
“In general, our view is that given the success of the Wii, lower price points on the Xbox 360, and deteriorating economy, Sony will likely use price as a lever to gain some momentum at retail this year. But in order to make a big splash, they probably need to accompany any pricing action with a high profile game launch or perhaps some more robust enhancements to Home.”
Mike Hickey, Pacific Crest Securities:
“We do not believe Sony’s ’09 software lineup offers any compelling exclusivity, enough that is, to sway consumer purchasing behavior toward their console or increase velocity at retail. For Sony to increase unit sales velocity and market share in ’09, we expect they will need to offer a more compelling price point. Thus, we think Sony will offer a “recession special” in early ’09, a $300 price point, where consumers can better justify the seemingly clumsy blu-ray technology proposition while taking advantage a growing catalog of games and anticipated releases including Heavy Rain, Killzone, God of War and Gran Turismo.”