Sony's Troubling Future

I feel that Sony is in trouble, and you're all more than welcome to debate my points. This is SW afterall.

For a while now, the PS3 has been the least expensive high-def media player on the market. That is all about to change when Blu-Ray and HD-DVD players hit the sub-500 and some the sub-300 mark around the 4th quarter of this year. That is bad news for Sony's 600 (US) dollar console.

Walmart is now officially backing HD-DVD, and that chain happens to be the largest general chain of stores in the world. They will be selling a 300 dollar HD-DVD player, and to the average consumer, that may be reasonable. Not to mention, that HD-DVD push will easily reach the majority of people in most areas.

Sony isn't known for implimenting all their technologies succesfully. Beta anybody? Memory Stick didn't exactly take off. Will Blu-Ray follow the same path? 

Sony already loses quite a bit on every console they sell. I'm afraid they're looking at losses on a whole new scale now. To stay competitive, they may be forced to drop the price of the PS3. You can argue until you're blue in the face, but the PS3 is not flying off the shelves like the Wii.

I'd be worried if I were a Sony exec...

rest assured sony is worried.

you don't reshuffle executive leadership so soon to a major product rollout if you weren't...;)

they should be... they bungled this generation abysmally....

and for what... ?   greed...

Do you people have any idea how many billions of dollars Sony would have to lose to even think about filing for bankruptcy?ramey70

no.

how many, exactly?

thanks.

Do you people have any idea how many billions of dollars Sony would have to lose to even think about filing for bankruptcy?ramey70

No. Educate me. I have a feeling you may not know either.

(And FYI, I wasn't claiming Sony is going to tank. I'm saying they're looking at tough roads ahead)

Deja Vu..

By Jim Lynch

Oct. 27, 2000 | Whether or not Sony was sincere in its claim that a supply crisis led it to cut its initial shipments of the PlayStation2 to just 500,000 units, there's little question that the corporation was successful in the arena of hype marketing. Lines of obsessed PlayStation fans were a news staple Wednesday. But is the so-called superconsole really worth staying up all night for?

No. The PS2 is not the revolutionary device that Sony's marketing department would have you believe. Don't get me wrong; it's definitely the most powerful video-game machine on the planet right now. But that's not enough.

And don't expect a huge number of quality games anytime soon. Sony has reversed positions with Sega and stupidly released a system that is in many ways a game developer's nightmare. Sega, learning from its Saturn debacle, went out of its way to make the Dreamcast easy to develop games for. But Sony, intoxicated with success from the first PlayStation, forgot the first rule of the video-game industry: Software sells systems. If you make it hard for developers to produce good games then there's no reason for people to buy the system. This oversight has already cost Sony some goodwill -- developers are howling about how hard it is to create games for the system. In an interview with Time magazine, John Carmack, one of the developers behind such massively popular games as Doom and Quake, said that the "PS2 is definitely more powerful than Dreamcast. But it's less convenient to extract performance from it."

Sony is also under the mistaken impression that including the ability to play DVD movies is a huge selling point. But true technophiles and hardcore gamers probably already have DVD drives. I'm a good case in point. I already own a Sony DVD player, so I could not care less if the $299 PS2 can play movies. I'd rather pay less and get a machine that just plays games instead.

In comparison, the Sega Dreamcast sells for $149 and has a giant library of games already available. Sega also has an online game network, Seganet. The Dreamcast comes with a built-in 56K modem and Sega will soon release a broadband (cable/DSL) adapter for it. (The PS2 does not ship with a modem.) Sega is banking on the appeal of multiplayer online gaming, even going so far as to rebate the entire cost of a Dreamcast to players who sign up for Seganet. And for the first time ever we actually have cross-platform online gaming -- Seganet lets Dreamcast players compete against PC players in games like Quake 3. Sony, on the other hand, is promising online gaming later on but currently has nothing to offer purchasers of the PS2.

In addition to Sega, Sony also has two 800-pound gaming gorillas breathing down its neck: Nintendo and Microsoft. Nintendo plans to release its powerful GameCube system next year. Don't downplay Nintendo's chances either. Despite having a rocky time with the N64, Nintendo has some of the most lucrative franchises in video-game history on its side (Zelda, Super Mario Brothers, Metroid, etc.) and a superb marketing machine.

The real wild card here, though, is Microsoft, which plans to release its X-Box game system next year. The Xbox will have even more powerful hardware than the PS2, and Microsoft has the marketing muscle and rapport with developers to do the PS2 real damage. Unlike Sony, Microsoft is taking great pains to make sure the X-Box is easy to make games for -- developers will also be able to easily port games from the PC to the X-Box, thus insuring a huge supply of games.

So should you feel bad if you can't get a PS2 right away? No way. If you wait a while you'll avoid all the lines and scuffling in stores and you'll end up with a much better selection of games. And if you wait long enough for the upcoming systems from Microsoft and Nintendo, you'll probably see a cut in the price of the PS2 as Sony tries to ward off both threats.

Hardcore gamers aren't known for their patience, but this is one occasion when playing it smart may mean not playing at all. For now.

And look how the PS2 ended up.  

Do you people have any idea how many billions of dollars Sony would have to lose to even think about filing for bankruptcy?ramey70

No. Do you? Oh, and Sony isn't exactly the stellar performing company people seem to think it is - the Computer Entertainment division props up certain other sections of Sony which aren't performing well, and now that its underperforming....  

Look another Noob thread!

I would be convinced if it was from a reliable source but SW isn't the best place for unbiased info.

[QUOTE="ramey70"]Do you people have any idea how many billions of dollars Sony would have to lose to even think about filing for bankruptcy?tango90101

no.

how many, exactly?

thanks.

Sony would have to have more liabilities than assets in order to seriously be in trouble. As of their last annual SEC filing Sony had $90 Billion in total assets, of which almost $10 Billion was cash or cash equivalents. This is compared to nearly $62 Billion in total liability. So to answer your question, Sony would have to post losses in the range of $28 Billion to approach Bankruptcy and even more to approach total insolvency.

Deja Vu..

 

By Jim Lynch

Oct. 27, 2000 | Whether or not Sony was sincere in its claim that a supply crisis led it to cut its initial shipments of the PlayStation2 to just 500,000 units, there's little question that the corporation was successful in the arena of hype marketing. Lines of obsessed PlayStation fans were a news staple Wednesday. But is the so-called superconsole really worth staying up all night for?

No. The PS2 is not the revolutionary device that Sony's marketing department would have you believe. Don't get me wrong; it's definitely the most powerful video-game machine on the planet right now. But that's not enough.

---

The PS2's stats are certainly impressive; it's got hardware power to burn. But so what? There's just not much software available that can take advantage of it. The games that are being released at the same time as the system don't rise much, if at all, above games available for Sega's rival (and cheaper) Dreamcast video-game system.

And don't expect a huge number of quality games anytime soon. Sony has reversed positions with Sega and stupidly released a system that is in many ways a game developer's nightmare. Sega, learning from its Saturn debacle, went out of its way to make the Dreamcast easy to develop games for. But Sony, intoxicated with success from the first PlayStation, forgot the first rule of the video-game industry: Software sells systems. If you make it hard for developers to produce good games then there's no reason for people to buy the system. This oversight has already cost Sony some goodwill -- developers are howling about how hard it is to create games for the system. In an interview with Time magazine, John Carmack, one of the developers behind such massively popular games as Doom and Quake, said that the "PS2 is definitely more powerful than Dreamcast. But it's less convenient to extract performance from it."

Sony is also under the mistaken impression that including the ability to play DVD movies is a huge selling point. But true technophiles and hardcore gamers probably already have DVD drives. I'm a good case in point. I already own a Sony DVD player, so I could not care less if the $299 PS2 can play movies. I'd rather pay less and get a machine that just plays games instead.

In comparison, the Sega Dreamcast sells for $149 and has a giant library of games already available. Sega also has an online game network, Seganet. The Dreamcast comes with a built-in 56K modem and Sega will soon release a broadband (cable/DSL) adapter for it. (The PS2 does not ship with a modem.) Sega is banking on the appeal of multiplayer online gaming, even going so far as to rebate the entire cost of a Dreamcast to players who sign up for Seganet. And for the first time ever we actually have cross-platform online gaming -- Seganet lets Dreamcast players compete against PC players in games like Quake 3. Sony, on the other hand, is promising online gaming later on but currently has nothing to offer purchasers of the PS2.

In addition to Sega, Sony also has two 800-pound gaming gorillas breathing down its neck: Nintendo and Microsoft. Nintendo plans to release its powerful GameCube system next year. Don't downplay Nintendo's chances either. Despite having a rocky time with the N64, Nintendo has some of the most lucrative franchises in video-game history on its side (Zelda, Super Mario Brothers, Metroid, etc.) and a superb marketing machine.

The real wild card here, though, is Microsoft, which plans to release its X-Box game system next year. The Xbox will have even more powerful hardware than the PS2, and Microsoft has the marketing muscle and rapport with developers to do the PS2 real damage. Unlike Sony, Microsoft is taking great pains to make sure the X-Box is easy to make games for -- developers will also be able to easily port games from the PC to the X-Box, thus insuring a huge supply of games.

So should you feel bad if you can't get a PS2 right away? No way. If you wait a while you'll avoid all the lines and scuffling in stores and you'll end up with a much better selection of games. And if you wait long enough for the upcoming systems from Microsoft and Nintendo, you'll probably see a cut in the price of the PS2 as Sony tries to ward off both threats.

Hardcore gamers aren't known for their patience, but this is one occasion when playing it smart may mean not playing at all. For now.

 

And look how the PS2 ended up.  

 

-Maddog-

DVD doesn't need a thousand+ dollar HDTV 

[QUOTE="tango90101"]

[QUOTE="ramey70"]Do you people have any idea how many billions of dollars Sony would have to lose to even think about filing for bankruptcy?ramey70

no.

how many, exactly?

thanks.

Sony would have to have more liabilities than assets in order to seriously be in trouble. As of their last annual SEC filing Sony had $90 Billion in total assets, of which almost $10 Billion was cash or cash equivalents. This is compared to nearly $62 Billion in total liability. So to answer your question, Sony would have to post losses in the range of $28 Billion to approach Bankruptcy and even more to approach total insolvency.

[QUOTE="ramey70"]Do you people have any idea how many billions of dollars Sony would have to lose to even think about filing for bankruptcy?WickeeKing

No. Do you? Oh, and Sony isn't exactly the stellar performing company people seem to think it is - the Computer Entertainment division props up certain other sections of Sony which aren't performing well, and now that its underperforming....

Actually, Sony's movie and consumer electronics divisions are performing very well.  In fact, their games division has posted heavy losses over the last several quarters while the movie, consumer electronics, and partnership with Ericsson has kept them posting quarterly profits.  They haven't posted a quarterly loss overall in quite some time.  Poorly performing companies don't post profits nor see their stocks surge over a 6 month trend.

[QUOTE="ramey70"]Do you people have any idea how many billions of dollars Sony would have to lose to even think about filing for bankruptcy?WickeeKing

No. Do you? Oh, and Sony isn't exactly the stellar performing company people seem to think it is - the Computer Entertainment division props up certain other sections of Sony which aren't performing well, and now that its underperforming....  

[QUOTE="tango90101"]

[QUOTE="ramey70"]Do you people have any idea how many billions of dollars Sony would have to lose to even think about filing for bankruptcy?ramey70

no.

how many, exactly?

thanks.

Sony would have to have more liabilities than assets in order to seriously be in trouble. As of their last annual SEC filing Sony had $90 Billion in total assets, of which almost $10 Billion was cash or cash equivalents. This is compared to nearly $62 Billion in total liability. So to answer your question, Sony would have to post losses in the range of $28 Billion to approach Bankruptcy and even more to approach total insolvency.

wrong.

there are many signs of a company's impending troubles.

they could file for protection in order to prevent themselves from ever reaching that point.

or, more likely, they'll simply change to a publisher, move away from hardware and make money there....

to use blank numbers like that as the only reason a company may file, is more than a little off...;)

[QUOTE="ramey70"][QUOTE="tango90101"]

[QUOTE="ramey70"]Do you people have any idea how many billions of dollars Sony would have to lose to even think about filing for bankruptcy?axt113

no.

how many, exactly?

thanks.

Sony would have to have more liabilities than assets in order to seriously be in trouble. As of their last annual SEC filing Sony had $90 Billion in total assets, of which almost $10 Billion was cash or cash equivalents. This is compared to nearly $62 Billion in total liability. So to answer your question, Sony would have to post losses in the range of $28 Billion to approach Bankruptcy and even more to approach total insolvency.

No, they couldn't.  Both are providing them with a loss at the moment and a total cessation of either line would not kill the company or even put them in jeopardy.  

[QUOTE="WickeeKing"]

[QUOTE="ramey70"]Do you people have any idea how many billions of dollars Sony would have to lose to even think about filing for bankruptcy?ramey70

No. Do you? Oh, and Sony isn't exactly the stellar performing company people seem to think it is - the Computer Entertainment division props up certain other sections of Sony which aren't performing well, and now that its underperforming....

Actually, Sony's movie and consumer electronics divisions are performing very well.  In fact, their games division has posted heavy losses over the last several quarters while the movie, consumer electronics, and partnership with Ericsson has kept them posting quarterly profits.  They haven't posted a quarterly loss overall in quite some time.  Poorly performing companies don't post profits nor see their stocks surge over a 6 month trend.

their electronics division is getting squeezed with more pressure on the way.

Apple's coming...;)

[QUOTE="ramey70"][QUOTE="tango90101"]

[QUOTE="ramey70"]Do you people have any idea how many billions of dollars Sony would have to lose to even think about filing for bankruptcy?tango90101

no.

how many, exactly?

thanks.

Sony would have to have more liabilities than assets in order to seriously be in trouble. As of their last annual SEC filing Sony had $90 Billion in total assets, of which almost $10 Billion was cash or cash equivalents. This is compared to nearly $62 Billion in total liability. So to answer your question, Sony would have to post losses in the range of $28 Billion to approach Bankruptcy and even more to approach total insolvency.

wrong.

there are many signs of a company's impending troubles.

they could file for protection in order to prevent themselves from ever reaching that point.

or, more likely, they'll simply change to a publisher, move away from hardware and make money there....

to use blank numbers like that as the only reason a company may file, is more than a little off...;)

Of course there are more signs of a company's troubles than liabilities to assets.  Others would be actually posting a loss, stocks prices taking a dive, etc.  None of which are happening to Sony.  The fact is, and people on this board somehow fail to grasp this, is that Microsoft, Nintendo, and Sony are very well run companies who perform very well. 

[QUOTE="ramey70"][QUOTE="WickeeKing"]

[QUOTE="ramey70"]Do you people have any idea how many billions of dollars Sony would have to lose to even think about filing for bankruptcy?tango90101

No. Do you? Oh, and Sony isn't exactly the stellar performing company people seem to think it is - the Computer Entertainment division props up certain other sections of Sony which aren't performing well, and now that its underperforming....

Actually, Sony's movie and consumer electronics divisions are performing very well. In fact, their games division has posted heavy losses over the last several quarters while the movie, consumer electronics, and partnership with Ericsson has kept them posting quarterly profits. They haven't posted a quarterly loss overall in quite some time. Poorly performing companies don't post profits nor see their stocks surge over a 6 month trend.

their electronics division is getting squeezed with more pressure on the way.

Apple's coming...;)

I'm curious, did Sony do something to you or your family?  I've never seen such loathing for a faceless corporation.  Out of all the companies in this world such as the Enrons and MCI's who robbed people of life savings and put them on the streets, or chemcial companies who poison our water and children I find it terribly odd to hate a company that makes a video game machine you don't like.

    Uh, yeah but the PS2 sold well at $300 (never over that price in the US), and it sold bunches at the $200 price point. The PS3 is not exactly selling great right now.

    And how is the PS3 going to get to that magical $200, or even $300 without massive losses? Also, the PS2 had DVD helping it, and like it or not, the sales pitch for DVD over VHS was miles better than the pitch between DVD and Blu-Ray or HD-DVD. 

    The PS3 is in trouble, and something has to happen inside Sony to change it for the better, because the system is hemorraging money, and its not selling as well as analysts and Sony had predicted, not by a long shot.

    The generation is far from over, but Sony has its work cut out for it this time, since MS and Nintendo aren't rolling over to die anytime soon.

[QUOTE="WickeeKing"]

[QUOTE="ramey70"]Do you people have any idea how many billions of dollars Sony would have to lose to even think about filing for bankruptcy?ramey70

No. Do you? Oh, and Sony isn't exactly the stellar performing company people seem to think it is - the Computer Entertainment division props up certain other sections of Sony which aren't performing well, and now that its underperforming....

Actually, Sony's movie and consumer electronics divisions are performing very well. In fact, their games division has posted heavy losses over the last several quarters while the movie, consumer electronics, and partnership with Ericsson has kept them posting quarterly profits. They haven't posted a quarterly loss overall in quite some time. Poorly performing companies don't post profits nor see their stocks surge over a 6 month trend.

TSkTSkTSk, actually if you look at the Sony ticker SNE you'll see that in a year:

link

 http://quotes.nasdaq.com/quote.dll?page=charting&mode=basics&selected=SNE&symbol=SNE%60

there has been no lift to EPS and the stock barely bounced back= no earnings for a year! Compared to NTDOY you'll see more than a marginal difference.

With the next sales quarter comming around there will definatley be sales ratio issues, not to mention the issues they have already with upper management shifts.

There bond rating was already lowered, they've closed down several factories, continue to fire staff and have executives bailing after the launch of the PS3!!!??!!

I'd say sell Sony short. I've calculated Sony's fair market price per share to be $49.

[QUOTE="tango90101"][QUOTE="ramey70"][QUOTE="tango90101"]

[QUOTE="ramey70"]Do you people have any idea how many billions of dollars Sony would have to lose to even think about filing for bankruptcy?ramey70

no.

how many, exactly?

thanks.

Sony would have to have more liabilities than assets in order to seriously be in trouble. As of their last annual SEC filing Sony had $90 Billion in total assets, of which almost $10 Billion was cash or cash equivalents. This is compared to nearly $62 Billion in total liability. So to answer your question, Sony would have to post losses in the range of $28 Billion to approach Bankruptcy and even more to approach total insolvency.

wrong.

there are many signs of a company's impending troubles.

they could file for protection in order to prevent themselves from ever reaching that point.

or, more likely, they'll simply change to a publisher, move away from hardware and make money there....

to use blank numbers like that as the only reason a company may file, is more than a little off...;)

Of course there are more signs of a company's troubles than liabilities to assets.  Others would be actually posting a loss, stocks prices taking a dive, etc.  None of which are happening to Sony.  The fact is, and people on this board somehow fail to grasp this, is that Microsoft, Nintendo, and Sony are very well run companies who perform very well. 

sony's stock rating and performance over the last year hasn't been very consistent. 

let's just agree to disagree.... save a lot of time...;)

I feel that Sony is in trouble, and you're all more than welcome to debate my points. This is SW afterall.

 

For a while now, the PS3 has been the least expensive high-def media player on the market. That is all about to change when Blu-Ray and HD-DVD players hit the sub-500 and some the sub-300 mark around the 4th quarter of this year. That is bad news for Sony's 600 (US) dollar console.

 

Walmart is now officially backing HD-DVD, and that chain happens to be the largest general chain of stores in the world. They will be selling a 300 dollar HD-DVD player, and to the average consumer, that may be reasonable. Not to mention, that HD-DVD push will easily reach the majority of people in most areas.

 

Sony isn't known for implimenting all their technologies succesfully. Beta anybody? Memory Stick didn't exactly take off. Will Blu-Ray follow the same path? 

 

Sony already loses quite a bit on every console they sell. I'm afraid they're looking at losses on a whole new scale now. To stay competitive, they may be forced to drop the price of the PS3. You can argue until you're blue in the face, but the PS3 is not flying off the shelves like the Wii.

 

I'd be worried if I were a Sony exec...

musicalmac

Actually Blu-Ray and HD DVD hardware will be closer than what you explained by the 4th qtr.  HD will still be slighty cheaper but Blu-Ray will not be $500, there will be $400 dollar machines as well as $300 dollar HD machines.  Does this hurt the PS3 because as you say there are cheaper Blu-Ray hardware at that time......not really.  For one, who says PS3 willnot have a price drop in the 4th qtr?  Who says those buying the PS3 are only buying one for the highdef format?  YOu are only assuming it will hurt because of the Blu-Ray player.....it's a gaming machine first, highdef player second.

Wal-Mart is not offically backing HD as you say.  If you re-read the report, it says it might infact be Blu-Ray hardware rofl.  Besides, just because Wal-Mart will be selling HD hardware why is that bad for Blu-Ray?  It would be bad if they ONLY supported HD hardware, then I would admit that would be pretty significant.  If Wal-Mart is going to sale $300 dollar HD players, I'm sure they'll be selling cheap Blu-Ray players as well. 

SOE isn't known for implementing new techs......like PS1 or PS2?

It's true, they were losing a ton when PS3 first released.  Now they are probably losing per unit sold today, just not as much as when it first released.  As the 4th qtr comes closer, the Blu-Ray technology will be cheaper and the Cell chip will be cheaper to manufacture.  This means it will be cheaper to make a PS3 hence a price drop is GOING to happen this year.  The PS3 is not flying off the shelf....funny how it's almost equal to the X360 sales last year isn't it?  The Wii is selling right now but it has equally no software like the PS3 and can not compare to the X360 in the software department.....so the answer is simply its the cheapest ONE therefore it sales more.  The real question is when the sales stop coming in, what is the Wii going to do to WOW the gamers they need to buy the system.  They don't have the highdef graphics to compete with the other two, all they have is unqiue controller with limited technology therefore it limits the AAA games from 3rd party.  We shall see how this plays out int he next year but don't assume Wii has won anything.

[QUOTE="ramey70"][QUOTE="WickeeKing"]

[QUOTE="ramey70"]Do you people have any idea how many billions of dollars Sony would have to lose to even think about filing for bankruptcy?tango90101

No. Do you? Oh, and Sony isn't exactly the stellar performing company people seem to think it is - the Computer Entertainment division props up certain other sections of Sony which aren't performing well, and now that its underperforming....

Actually, Sony's movie and consumer electronics divisions are performing very well.  In fact, their games division has posted heavy losses over the last several quarters while the movie, consumer electronics, and partnership with Ericsson has kept them posting quarterly profits.  They haven't posted a quarterly loss overall in quite some time.  Poorly performing companies don't post profits nor see their stocks surge over a 6 month trend.

their electronics division is getting squeezed with more pressure on the way.

Apple's coming...;)

[QUOTE="ramey70"][QUOTE="WickeeKing"]

[QUOTE="ramey70"]Do you people have any idea how many billions of dollars Sony would have to lose to even think about filing for bankruptcy?elpoep

No. Do you? Oh, and Sony isn't exactly the stellar performing company people seem to think it is - the Computer Entertainment division props up certain other sections of Sony which aren't performing well, and now that its underperforming....

Actually, Sony's movie and consumer electronics divisions are performing very well. In fact, their games division has posted heavy losses over the last several quarters while the movie, consumer electronics, and partnership with Ericsson has kept them posting quarterly profits. They haven't posted a quarterly loss overall in quite some time. Poorly performing companies don't post profits nor see their stocks surge over a 6 month trend.

TSkTSkTSk, actually if you look at the Sony ticker SNE you'll see that in a year there has been no lift to EPS and the stock barely bounced back= no earnings for a year! Compared to NTDOY you'll see more than a marginal difference.

With the next sales quarter comming around there will definatley be sales ratio issues, not to mention the issues they have already with upper management shifts.

There bond rating was already lowered, they've closed down several factories, continue to fire staff and have executives bailing after the launch of the PS3!!!??!!

I'd say sell Sony short. I've calculated Sony's fair market price per share to be $49.

And if you look at their 2y ticker you'll see it's 20 points higher.  Further out of 5 recommended trends according to analysts there are 2 strong buys for SNE, 2 Buys, and one hold.  None for sell or strong sell.   You seem to know something most analysts don't.

Sony is not as big of a company as some of you PS3 users want to think. There market value is $55 billion. Just to put that against others. MS $284 Wal-mart $204 Bill gates is even worth $68.8 billion. So yes Sony is not as powerfull as PS3 users wish they were.

http://finapps.forbes.com/finapps/jsp/finance/compinfo/CIAtAGlance.jsp?tkr=SNE

Sony is not as big of a company as some of you PS3 users want to think. There market value is $55 billion. Just to put that against others. MS $284 Wal-mart $204 Bill gates is even worth $68.8 billion. So yes Sony is not as powerfull as PS3 users wish they were.

http://finapps.forbes.com/finapps/jsp/finance/compinfo/CIAtAGlance.jsp?tkr=SNE

Eltroz

 If you're comparing them to Microsoft and Walmart then almost every corporation on the planet would be considered small and powerless.  

Actually Blu-Ray and HD DVD hardware will be closer than what you explained by the 4th qtr.  HD will still be slighty cheaper but Blu-Ray will not be $500, there will be $400 dollar machines as well as $300 dollar HD machines.  Does this hurt the PS3 because as you say there are cheaper Blu-Ray hardware at that time......not really.  For one, who says PS3 willnot have a price drop in the 4th qtr?  Who says those buying the PS3 are only buying one for the highdef format?  YOu are only assuming it will hurt because of the Blu-Ray player.....it's a gaming machine first, highdef player second.

Wal-Mart is not offically backing HD as you say.  If you re-read the report, it says it might infact be Blu-Ray hardware rofl.  Besides, just because Wal-Mart will be selling HD hardware why is that bad for Blu-Ray?  It would be bad if they ONLY supported HD hardware, then I would admit that would be pretty significant.  If Wal-Mart is going to sale $300 dollar HD players, I'm sure they'll be selling cheap Blu-Ray players as well. 

SOE isn't known for implementing new techs......like PS1 or PS2?

It's true, they were losing a ton when PS3 first released.  Now they are probably losing per unit sold today, just not as much as when it first released.  As the 4th qtr comes closer, the Blu-Ray technology will be cheaper and the Cell chip will be cheaper to manufacture.  This means it will be cheaper to make a PS3 hence a price drop is GOING to happen this year.  The PS3 is not flying off the shelf....funny how it's almost equal to the X360 sales last year isn't it?  The Wii is selling right now but it has equally no software like the PS3 and can not compare to the X360 in the software department.....so the answer is simply its the cheapest ONE therefore it sales more.  The real question is when the sales stop coming in, what is the Wii going to do to WOW the gamers they need to buy the system.  They don't have the highdef graphics to compete with the other two, all they have is unqiue controller with limited technology therefore it limits the AAA games from 3rd party.  We shall see how this plays out int he next year but don't assume Wii has won anything.

darthogre

Fakeboy post. That or it's just grossly incorrect. I'm not assuming anything. I'm asking questions about the future. Do you even read what you post before you post it? :?

Honestly...

Sony is not as big of a company as some of you PS3 users want to think. There market value is $55 billion. Just to put that against others. MS $284 Wal-mart $204 Bill gates is even worth $68.8 billion. So yes Sony is not as powerfull as PS3 users wish they were.

http://finapps.forbes.com/finapps/jsp/finance/compinfo/CIAtAGlance.jsp?tkr=SNE

Eltroz

[QUOTE="elpoep"][QUOTE="ramey70"][QUOTE="WickeeKing"]

[QUOTE="ramey70"]Do you people have any idea how many billions of dollars Sony would have to lose to even think about filing for bankruptcy?ramey70

No. Do you? Oh, and Sony isn't exactly the stellar performing company people seem to think it is - the Computer Entertainment division props up certain other sections of Sony which aren't performing well, and now that its underperforming....

Actually, Sony's movie and consumer electronics divisions are performing very well. In fact, their games division has posted heavy losses over the last several quarters while the movie, consumer electronics, and partnership with Ericsson has kept them posting quarterly profits. They haven't posted a quarterly loss overall in quite some time. Poorly performing companies don't post profits nor see their stocks surge over a 6 month trend.

TSkTSkTSk, actually if you look at the Sony ticker SNE you'll see that in a year there has been no lift to EPS and the stock barely bounced back= no earnings for a year! Compared to NTDOY you'll see more than a marginal difference.

With the next sales quarter comming around there will definatley be sales ratio issues, not to mention the issues they have already with upper management shifts.

There bond rating was already lowered, they've closed down several factories, continue to fire staff and have executives bailing after the launch of the PS3!!!??!!

I'd say sell Sony short. I've calculated Sony's fair market price per share to be $49.

And if you look at their 2y ticker you'll see it's 20 points higher. Further out of 5 recommended trends according to analysts there are 2 strong buys for SNE, 2 Buys, and one hold. None for sell or strong sell. You seem to know something most analysts don't.

I do know something that most analysts don't know.  IF you are capable of running a multiple regression analysis for those two years you will see no certainty in correlation to back those numbers.

From a technical analysis alone there is no reasonable trend to suggest strong performance, a fundamental analysis will prove that Sony has pumped up there accruals and PS3 on store shelves will = very low Q2 earnings that Bloomberg was expecting this last Q1.

Last September Sony fell $5!!! that is a lot of points before sucha large launch.  If you have a bunch of casual internet less risk averse investors hoping on Ameritrade listening to Kramer you will see people taking that "buy" --

If you want to put your money where your mouth is I'll have my boys letter up a "Put" contract for you for (how manty shares of )SNE.    

[QUOTE="Eltroz"]

Sony is not as big of a company as some of you PS3 users want to think. There market value is $55 billion. Just to put that against others. MS $284 Wal-mart $204 Bill gates is even worth $68.8 billion. So yes Sony is not as powerfull as PS3 users wish they were.

http://finapps.forbes.com/finapps/jsp/finance/compinfo/CIAtAGlance.jsp?tkr=SNE

Jack-Napier

[QUOTE="ramey70"][QUOTE="elpoep"][QUOTE="ramey70"][QUOTE="WickeeKing"]

[QUOTE="ramey70"]Do you people have any idea how many billions of dollars Sony would have to lose to even think about filing for bankruptcy?elpoep

No. Do you? Oh, and Sony isn't exactly the stellar performing company people seem to think it is - the Computer Entertainment division props up certain other sections of Sony which aren't performing well, and now that its underperforming....

Actually, Sony's movie and consumer electronics divisions are performing very well. In fact, their games division has posted heavy losses over the last several quarters while the movie, consumer electronics, and partnership with Ericsson has kept them posting quarterly profits. They haven't posted a quarterly loss overall in quite some time. Poorly performing companies don't post profits nor see their stocks surge over a 6 month trend.

TSkTSkTSk, actually if you look at the Sony ticker SNE you'll see that in a year there has been no lift to EPS and the stock barely bounced back= no earnings for a year! Compared to NTDOY you'll see more than a marginal difference.

With the next sales quarter comming around there will definatley be sales ratio issues, not to mention the issues they have already with upper management shifts.

There bond rating was already lowered, they've closed down several factories, continue to fire staff and have executives bailing after the launch of the PS3!!!??!!

I'd say sell Sony short. I've calculated Sony's fair market price per share to be $49.

And if you look at their 2y ticker you'll see it's 20 points higher. Further out of 5 recommended trends according to analysts there are 2 strong buys for SNE, 2 Buys, and one hold. None for sell or strong sell. You seem to know something most analysts don't.

I do know something that most analysts don't know. IF you are capable of running a multiple regression analysis for those two years you will see no certainty in correlation to back those numbers.

From a technical analysis alone there is no reasonable trend to suggest strong performance, a fundamental analysis will prove that Sony has pumped up there accruals and PS3 on store shelves will = very low Q2 earnings that Bloomberg was expecting this last Q1.

Last September Sony fell $5!!! that is a lot of points before sucha large launch. If you have a bunch of casual internet less risk averse investors hoping on Ameritrade listening to Kramer you will see people taking that "buy" --

If you want to put your money where your mouth is I'll have my boys letter up a "Put" contract for you for (how manty shares of )SNE.

Why would I do that?  Surley you would know that there are much better places to invest than common stocks correct? 

[QUOTE="elpoep"][QUOTE="ramey70"][QUOTE="elpoep"][QUOTE="ramey70"][QUOTE="WickeeKing"]

[QUOTE="ramey70"]Do you people have any idea how many billions of dollars Sony would have to lose to even think about filing for bankruptcy?ramey70

No. Do you? Oh, and Sony isn't exactly the stellar performing company people seem to think it is - the Computer Entertainment division props up certain other sections of Sony which aren't performing well, and now that its underperforming....

Actually, Sony's movie and consumer electronics divisions are performing very well. In fact, their games division has posted heavy losses over the last several quarters while the movie, consumer electronics, and partnership with Ericsson has kept them posting quarterly profits. They haven't posted a quarterly loss overall in quite some time. Poorly performing companies don't post profits nor see their stocks surge over a 6 month trend.

TSkTSkTSk, actually if you look at the Sony ticker SNE you'll see that in a year there has been no lift to EPS and the stock barely bounced back= no earnings for a year! Compared to NTDOY you'll see more than a marginal difference.

With the next sales quarter comming around there will definatley be sales ratio issues, not to mention the issues they have already with upper management shifts.

There bond rating was already lowered, they've closed down several factories, continue to fire staff and have executives bailing after the launch of the PS3!!!??!!

I'd say sell Sony short. I've calculated Sony's fair market price per share to be $49.

And if you look at their 2y ticker you'll see it's 20 points higher. Further out of 5 recommended trends according to analysts there are 2 strong buys for SNE, 2 Buys, and one hold. None for sell or strong sell. You seem to know something most analysts don't.

I do know something that most analysts don't know. IF you are capable of running a multiple regression analysis for those two years you will see no certainty in correlation to back those numbers.

From a technical analysis alone there is no reasonable trend to suggest strong performance, a fundamental analysis will prove that Sony has pumped up there accruals and PS3 on store shelves will = very low Q2 earnings that Bloomberg was expecting this last Q1.

Last September Sony fell $5!!! that is a lot of points before sucha large launch. If you have a bunch of casual internet less risk averse investors hoping on Ameritrade listening to Kramer you will see people taking that "buy" --

If you want to put your money where your mouth is I'll have my boys letter up a "Put" contract for you for (how manty shares of )SNE.

Why would I do that? Surley you would know that there are much better places to invest than common stocks correct?

AhA! Thank you for admitting that Sony is too much of a risk and holds too little expected return.

Sony FTL!!!

[QUOTE="Eltroz"]

Sony is not as big of a company as some of you PS3 users want to think. There market value is $55 billion. Just to put that against others. MS $284 Wal-mart $204 Bill gates is even worth $68.8 billion. So yes Sony is not as powerfull as PS3 users wish they were.

http://finapps.forbes.com/finapps/jsp/finance/compinfo/CIAtAGlance.jsp?tkr=SNE

Jack-Napier

    From the 2006 year. What year was Vista released? Oh yeah, end of 2006 for businesses, 2007 for home users. Wait and see where MS is in 2007's ranking.

[QUOTE="darthogre"]

Actually Blu-Ray and HD DVD hardware will be closer than what you explained by the 4th qtr.  HD will still be slighty cheaper but Blu-Ray will not be $500, there will be $400 dollar machines as well as $300 dollar HD machines.  Does this hurt the PS3 because as you say there are cheaper Blu-Ray hardware at that time......not really.  For one, who says PS3 willnot have a price drop in the 4th qtr?  Who says those buying the PS3 are only buying one for the highdef format?  YOu are only assuming it will hurt because of the Blu-Ray player.....it's a gaming machine first, highdef player second.

Wal-Mart is not offically backing HD as you say.  If you re-read the report, it says it might infact be Blu-Ray hardware rofl.  Besides, just because Wal-Mart will be selling HD hardware why is that bad for Blu-Ray?  It would be bad if they ONLY supported HD hardware, then I would admit that would be pretty significant.  If Wal-Mart is going to sale $300 dollar HD players, I'm sure they'll be selling cheap Blu-Ray players as well. 

SOE isn't known for implementing new techs......like PS1 or PS2?

It's true, they were losing a ton when PS3 first released.  Now they are probably losing per unit sold today, just not as much as when it first released.  As the 4th qtr comes closer, the Blu-Ray technology will be cheaper and the Cell chip will be cheaper to manufacture.  This means it will be cheaper to make a PS3 hence a price drop is GOING to happen this year.  The PS3 is not flying off the shelf....funny how it's almost equal to the X360 sales last year isn't it?  The Wii is selling right now but it has equally no software like the PS3 and can not compare to the X360 in the software department.....so the answer is simply its the cheapest ONE therefore it sales more.  The real question is when the sales stop coming in, what is the Wii going to do to WOW the gamers they need to buy the system.  They don't have the highdef graphics to compete with the other two, all they have is unqiue controller with limited technology therefore it limits the AAA games from 3rd party.  We shall see how this plays out int he next year but don't assume Wii has won anything.

musicalmac

Fakeboy post. That or it's just grossly incorrect. I'm not assuming anything. I'm asking questions about the future. Do you even read what you post before you post it? :?

Honestly...

Honestly, why even put this in your post then "you're all more than welcome to debate my points" if all you are going to do is whine when someone goes through point by point with a possible answer.  All I did was make an educated guess from the information they I have and the experience I have in the entertainment business. 

You say your asking questions about the future.....no you're making statements of why you think SOE is in trouble and why the execs should be worried.  You're post was meant to paint the PS3 as a failure and will continue to fail.  That is a guess based on limited information.  You take selected information and use that as your evidence.....usually people call that propaganda but I was willing to debate your points anyways because after all they were your opinion. 

I read everything you said, I'm just going point by point like you did.  What I find funny is you are quoting the "HD Walmart story" yet it's now been intrepreted as being for Blu-Ray hardware.....so they said wait for the offical announcements.  Yet you go to say it's HD players like it's fact.  That's not to say Wal-Mart won't be selling $300 HD players......infact I've been saying that for the past couple months.  What you fail to say though is there will be an equally cheap Blu-Ray players during the 4th qtr as well.  Pretending that both technologies will not see signficant price drops is truely being a fanboy.

 

Sony isn't known for implimenting all their technologies succesfully. Beta anybody? Memory Stick didn't exactly take off. Will Blu-Ray follow the same path?

musicalmac

I still use beta, lots of people do. People don't realize that after Beta failed as a consumer media it took off as a professional one. Digi Beta is widely used in filmmaking to this day....

Its irrelivant I know, but a fun factoid. Why no mention of LD?

[QUOTE="musicalmac"]

Sony isn't known for implimenting all their technologies succesfully. Beta anybody? Memory Stick didn't exactly take off. Will Blu-Ray follow the same path?

TacoJelly

Its irrelivant I know, but a fun factoid. Why no mention of LD?

I also find it odd he didn't mention Video8 (and subsequent Hi8 and Digital8) which Sony developed for camcorders and proved very successful. 

Honestly, why even put this in your post then "you're all more than welcome to debate my points" if all you are going to do is whine when someone goes through point by point with a possible answer.  All I did was make an educated guess from the information they I have and the experience I have in the entertainment business. 

You say your asking questions about the future.....no you're making statements of why you think SOE is in trouble and why the execs should be worried.  You're post was meant to paint the PS3 as a failure and will continue to fail.  That is a guess based on limited information.  You take selected information and use that as your evidence.....usually people call that propaganda but I was willing to debate your points anyways because after all they were your opinion. 

I read everything you said, I'm just going point by point like you did.  What I find funny is you are quoting the "HD Walmart story" yet it's now been intrepreted as being for Blu-Ray hardware.....so they said wait for the offical announcements.  Yet you go to say it's HD players like it's fact.  That's not to say Wal-Mart won't be selling $300 HD players......infact I've been saying that for the past couple months.  What you fail to say though is there will be an equally cheap Blu-Ray players during the 4th qtr as well.  Pretending that both technologies will not see signficant price drops is truely being a fanboy.

darthogre

Wow. :|

I'm the farthest thing you'll find from a fanboy. I'm taking the information given to me, and relaying the potential problems it could cause for Sony. I'm not claiming the PS3 as a failure.

See what I'm talking about with your posts being a little off the mark?

AhA! Thank you for admitting that Sony is too much of a risk and holds too little expected return.

 

Sony FTL!!!

elpoep

Actually, I admitted I wouldn't invest my money in a common stock. Be it Microsoft, Sony, Exxon-Mobil, Ford, GM, Bank Of America or anyone else.

I still use beta, lots of people do. People don't realize that after Beta failed as a consumer media it took off as a professional one. Digi Beta is widely used in filmmaking to this day....

Its irrelivant I know, but a fun factoid. Why no mention of LD?

TacoJelly

I also find it odd he didn't mention Video8 (and subsequent Hi8 and Digital8) which Sony developed for camcorders and proved very successful. 

ramey70

I guess they just didn't seem super important. I understand they had their uses, but the proprietary nature hurt them.

[QUOTE="elpoep"][QUOTE="ramey70"][QUOTE="elpoep"][QUOTE="ramey70"][QUOTE="elpoep"][QUOTE="ramey70"][QUOTE="WickeeKing"]

[QUOTE="ramey70"]Do you people have any idea how many billions of dollars Sony would have to lose to even think about filing for bankruptcy?ramey70

No. Do you? Oh, and Sony isn't exactly the stellar performing company people seem to think it is - the Computer Entertainment division props up certain other sections of Sony which aren't performing well, and now that its underperforming....

Actually, Sony's movie and consumer electronics divisions are performing very well. In fact, their games division has posted heavy losses over the last several quarters while the movie, consumer electronics, and partnership with Ericsson has kept them posting quarterly profits. They haven't posted a quarterly loss overall in quite some time. Poorly performing companies don't post profits nor see their stocks surge over a 6 month trend.

TSkTSkTSk, actually if you look at the Sony ticker SNE you'll see that in a year there has been no lift to EPS and the stock barely bounced back= no earnings for a year! Compared to NTDOY you'll see more than a marginal difference.

With the next sales quarter comming around there will definatley be sales ratio issues, not to mention the issues they have already with upper management shifts.

There bond rating was already lowered, they've closed down several factories, continue to fire staff and have executives bailing after the launch of the PS3!!!??!!

I'd say sell Sony short. I've calculated Sony's fair market price per share to be $49.

And if you look at their 2y ticker you'll see it's 20 points higher. Further out of 5 recommended trends according to analysts there are 2 strong buys for SNE, 2 Buys, and one hold. None for sell or strong sell. You seem to know something most analysts don't.

I do know something that most analysts don't know. IF you are capable of running a multiple regression analysis for those two years you will see no certainty in correlation to back those numbers.

From a technical analysis alone there is no reasonable trend to suggest strong performance, a fundamental analysis will prove that Sony has pumped up there accruals and PS3 on store shelves will = very low Q2 earnings that Bloomberg was expecting this last Q1.

Last September Sony fell $5!!! that is a lot of points before sucha large launch. If you have a bunch of casual internet less risk averse investors hoping on Ameritrade listening to Kramer you will see people taking that "buy" --

If you want to put your money where your mouth is I'll have my boys letter up a "Put" contract for you for (how manty shares of )SNE.

Why would I do that? Surley you would know that there are much better places to invest than common stocks correct?

AhA! Thank you for admitting that Sony is too much of a risk and holds too little expected return.

Sony FTL!!!

Actually, I admitted I wouldn't invest my money in a common stock. Be it Microsoft, Sony, Exxon-Mobil, Ford, GM, Bank Of America or anyone else.

 If you don't build a portfolio of securities where do you put your savings? 

So, you won't buy Sony stock?!

Would you suggest it to someone who is looking to invest in common stock?  Why?

Between the 2 which would you buy right now if you had to? NTDOY (nintendo w/ over 100%growth) or SNE(about 4% growth)?

P.S. Sony would have to lose roughly 50 billion dollars to be in trouble. 

If you don't build a portfolio of securities where do you put your savings?

So, you won't buy Sony stock?!

Would you suggest it to someone who is looking to invest in common stock? Why?

Between the 2 which would you buy right now if you had to? NTDOY (nintendo w/ over 100%growth) or SNE(about 4% growth)?

P.S. Sony would have to lose roughly 50 billion dollars to be in trouble.

 

elpoep

I keep my savings in mix of a 100% company matched 401k, 5% interest bearing savings, land holdings in and around North Tarrant County, and for the past to years heavy investing in the Barnett Shale which has been very lucrative.

No, I would not invest in Sony or any other common stock, so I wouldn't suggest it.

If I was forced I would invest in Nintendo instead of Sony.  Why wouldn't I?   I fail to see how that choice is indicative of Sony as a corporation.  Nintendo is one of the best run companies in the world, far better than Sony in fact. 

I feel that Sony is in trouble, and you're all more than welcome to debate my points. This is SW afterall.musicalmac

For a while now, the PS3 has been the least expensive high-def media player on the market. That is all about to change when Blu-Ray and HD-DVD players hit the sub-500 and some the sub-300 mark around the 4th quarter of this year. That is bad news for Sony's 600 (US) dollar console.

While HD-DVD will probably be in that price range by the end of this year, I doubt BR will be dropping that low.  Right now BR players sell for $1200 (cad).  These machines are expensive because of the manufacturing process and the current low demand.  While the price will come down slightly, without a high surge in demand, I doubt the price of BR players will drop below $500.

Now, if Sony can produce BR players at that price level, it would most likely mean the cost of making the hardware has also dropped.  what does this mean for the PS3?  Well, the whole reason the PS3 is so expensive is exactly the same reason BR players are so expensive...the BR hardware.  If the price drops for BR players then chances are SOny will be able to drop the price of the PS3 as well.  Either way, I think it is a good sign for Sony as they stand to gain significantly more off BR sales and success than the PS3 itself.

Walmart is now officially backing HD-DVD, and that chain happens to be the largest general chain of stores in the world. They will be selling a 300 dollar HD-DVD player, and to the average consumer, that may be reasonable. Not to mention, that HD-DVD push will easily reach the majority of people in most areas.

Well, Walmart is also known for selling crap.  SO I don't know if Walmart backing HD-DVD is a sign that the general consumer will love it.  It may get them interested, but the fact remains that BR is in the lead right now and is gaining every week.  BR simply has much more support and EXCLUSIVE support from three major companies.  HD-DVD only has exclusive support from one company.  

So not only do MORE movies come out for BR every week, but chances are if you don't go with BR you are more likely to miss out on a major title you may be wanting.  If people see that the movies they want are exlusive to BR, they may see the much cheaper price of the HD-DVD as a negative or a sign that the machine is not successful and therefore on "clearance."

Sony isn't known for implimenting all their technologies succesfully. Beta anybody? Memory Stick didn't exactly take off. Will Blu-Ray follow the same path? 

We've all heard the BETA thing...but let's be perfectly honest and fair here.  Let's stop bashing SOny for trying new things when they don't work.  If we treated every corporation the way we treated SOny, then MS would have died a decade ago.  MS fails at like %90 of the things they do...fails miserably.  Yet we never heard people question their new products.  Instead we hear "windows anybody?"   We don't hear people bashing the I-pod because apple has been unable to see massive mainstream success with their computers.  Yet no matter if Sony succeeds with TVs, consoles or other items (in the past anyway) then we still here what you have said.  It is stupid to punish a company for trying to bring new things to the consumer. 

Sony already loses quite a bit on every console they sell. I'm afraid they're looking at losses on a whole new scale now.

The reason I say Sony is in a healthier position than in the past is because when the PS1 was coming out, SOny was starting to see problems with all their TV and electronics sales.  When the PS2 came out, SOny essentially was relying exlcusively on PS2 profits to make up for the losses the rest of the company was seeing.   However, now Sony has restructured, fixed their management, and is once again seeing success in their past areas.  Sony as a company is healthier than they have been in a while.  The only difference is that while the company as a whole is getting their crap together, now the PS3 is the money loser. 

Frankly, I believe that Sony as a company has a better future with their wide range of products doing well as opposed to relying on one single product to pull the company through.   It's not the perfect situation right now, but it's not a "troubling future" if you ask me. 

I will also remind you to not believe the myths spread through the videogame world.  While the PS3 is most certainly losing money for SOny (roughly the same as the 360 loses for MS but with smaller sales...so most likely more loss per console than MS), the PS1 and PS2 both made Sony money practically from day one.  If anything is going to hurt the future of the PS3, it won't be the price or SOny's push for BR...it will be their switch to what I see as an unsustainable and unrealistic business practice.  Make no mistake, losing money on every console sold if a new phenomenon and it has not once proven to make a profit.  I won't go into the details, since people are more willing to believe the myth than the borign facts.  I will say that Sony bought into the hype of this ridiculous console "razor blade" theory and it will end up hurting them in the long run. Even moreso than the price of the console itself.

 To stay competitive, they may be forced to drop the price of the PS3. You can argue until you're blue in the face, but the PS3 is not flying off the shelves like the Wii.

The PS3  will probably never fly off the shelves like the wii.  It's like comparing console sales to DS sales.  You just can't compare the two.  Hell, I have a wii specifically because I knew what it would offer and it was cheaper to buy a Wii and two games than it was to get a 360 with 0 games and no tax.  The real 360 that is.

You are right that a price war could cripple the PS3.  But that is really on MS to decide.  They are losing a bundle on the 360 as well.  However, MS is in a good spot right now where they really don't have to drop their price.  they won't ever compete with Wii sales and not even a PS3 price drop today could compete with the 360 library or price.  So MS is in a comfortable position that nothing will change until SOny gets a much bigger library.

 

[QUOTE="musicalmac"] I feel that Sony is in trouble, and you're all more than welcome to debate my points. This is SW afterall.Rosencrantz

For a while now, the PS3 has been the least expensive high-def media player on the market. That is all about to change when Blu-Ray and HD-DVD players hit the sub-500 and some the sub-300 mark around the 4th quarter of this year. That is bad news for Sony's 600 (US) dollar console.

While HD-DVD will probably be in that price range by the end of this year, I doubt BR will be dropping that low.  Right now BR players sell for $1200 (cad).  These machines are expensive because of the manufacturing process and the current low demand.  While the price will come down slightly, without a high surge in demand, I doubt the price of BR players will drop below $500.

Now, if Sony can produce BR players at that price level, it would most likely mean the cost of making the hardware has also dropped.  what does this mean for the PS3?  Well, the whole reason the PS3 is so expensive is exactly the same reason BR players are so expensive...the BR hardware.  If the price drops for BR players then chances are SOny will be able to drop the price of the PS3 as well.  Either way, I think it is a good sign for Sony as they stand to gain significantly more off BR sales and success than the PS3 itself.

Walmart is now officially backing HD-DVD, and that chain happens to be the largest general chain of stores in the world. They will be selling a 300 dollar HD-DVD player, and to the average consumer, that may be reasonable. Not to mention, that HD-DVD push will easily reach the majority of people in most areas.

Well, Walmart is also known for selling crap.  SO I don't know if Walmart backing HD-DVD is a sign that the general consumer will love it.  It may get them interested, but the fact remains that BR is in the lead right now and is gaining every week.  BR simply has much more support and EXCLUSIVE support from three major companies.  HD-DVD only has exclusive support from one company.  

So not only do MORE movies come out for BR every week, but chances are if you don't go with BR you are more likely to miss out on a major title you may be wanting.  If people see that the movies they want are exlusive to BR, they may see the much cheaper price of the HD-DVD as a negative or a sign that the machine is not successful and therefore on "clearance."

Sony isn't known for implimenting all their technologies succesfully. Beta anybody? Memory Stick didn't exactly take off. Will Blu-Ray follow the same path? 

We've all heard the BETA thing...but let's be perfectly honest and fair here.  Let's stop bashing SOny for trying new things when they don't work.  If we treated every corporation the way we treated SOny, then MS would have died a decade ago.  MS fails at like %90 of the things they do...fails miserably.  Yet we never heard people question their new products.  Instead we hear "windows anybody?"   We don't hear people bashing the I-pod because apple has been unable to see massive mainstream success with their computers.  Yet no matter if Sony succeeds with TVs, consoles or other items (in the past anyway) then we still here what you have said.  It is stupid to punish a company for trying to bring new things to the consumer. 

Sony already loses quite a bit on every console they sell. I'm afraid they're looking at losses on a whole new scale now.

The reason I say Sony is in a healthier position than in the past is because when the PS1 was coming out, SOny was starting to see problems with all their TV and electronics sales.  When the PS2 came out, SOny essentially was relying exlcusively on PS2 profits to make up for the losses the rest of the company was seeing.   However, now Sony has restructured, fixed their management, and is once again seeing success in their past areas.  Sony as a company is healthier than they have been in a while.  The only difference is that while the company as a whole is getting their crap together, now the PS3 is the money loser. 

Frankly, I believe that Sony as a company has a better future with their wide range of products doing well as opposed to relying on one single product to pull the company through.   It's not the perfect situation right now, but it's not a "troubling future" if you ask me. 

I will also remind you to not believe the myths spread through the videogame world.  While the PS3 is most certainly losing money for SOny (roughly the same as the 360 loses for MS but with smaller sales...so most likely more loss per console than MS), the PS1 and PS2 both made Sony money practically from day one.  If anything is going to hurt the future of the PS3, it won't be the price or SOny's push for BR...it will be their switch to what I see as an unsustainable and unrealistic business practice.  Make no mistake, losing money on every console sold if a new phenomenon and it has not once proven to make a profit.  I won't go into the details, since people are more willing to believe the myth than the borign facts.  I will say that Sony bought into the hype of this ridiculous console "razor blade" theory and it will end up hurting them in the long run. Even moreso than the price of the console itself.

 To stay competitive, they may be forced to drop the price of the PS3. You can argue until you're blue in the face, but the PS3 is not flying off the shelves like the Wii.

The PS3  will probably never fly off the shelves like the wii.  It's like comparing console sales to DS sales.  You just can't compare the two.  Hell, I have a wii specifically because I knew what it would offer and it was cheaper to buy a Wii and two games than it was to get a 360 with 0 games and no tax.  The real 360 that is.

You are right that a price war could cripple the PS3.  But that is really on MS to decide.  They are losing a bundle on the 360 as well.  However, MS is in a good spot right now where they really don't have to drop their price.  they won't ever compete with Wii sales and not even a PS3 price drop today could compete with the 360 library or price.  So MS is in a comfortable position that nothing will change until SOny gets a much bigger library.

Everybody! Take a close look at this- this is a real, thought out position on the points I made. I appreciate this post on so many levels. This is what I mean when I say debate!!

A price war COULD cripple the PS3, but at the same time, HD-DVD is going to need more backing to be truly succesful. However, you must keep in mind that the superior technology doesn't always succeed. I'm not going to start claiming one hi-def format is better than the next, but Beta WAS better than VHS, but it lost the war.

I nope that a whole NEW format will win this war, or that companies won't develop purly Blu-Ray or HD-DVD players, and make a hybrid player that plays ANYTHING. There are other medias on the horizon that are far superior to both Blu-Ray and HD-DVD, and far less expensive, too ;)

Google is your friend on this one.