PlayStation 4 won't require 'major loss' like PS3, says Sony

The PlayStation 4 will not incur a "major loss" like the PS3, thanks to Sony spreading out its manufacturing process to partners instead of handling so much of the Cell investment itself.

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Sony expects that the PlayStation 4 won't see losses like the PlayStation 3, according to a recent earnings call. The company said that in-house investments, especially regarding the Cell chip, made the PS3 an uphill battle, but its new manufacturing pipeline spreads out the cost significantly.

"Unlike PS3, we are not planning a major loss to be incurred with the launch of PS4," said CFO Masaru Kato during an earnings call (via Eurogamer). "At the time we developed PS3, we made a lot of in-house investments to develop the chip, the Cell chip. Development of the chip saw the silicon processing and all the facilities invested by us ourselves.

"But this time, yes we have a team working on chip development, but we already have existing technology to incorporate and also product investment and all the facilities will now be invested by our partners, other foundries, so we don't have to make all the investment in-house."

Sony hasn't announced a price for the PlayStation 4 yet, and its manufacturing costs haven't been studied in detail. This doesn't necessarily mean the PS4 will be profitable from the start, but its margins should at least be much thinner than the prior console. Even despite its high price tag, the PlayStation 3 spent almost four years on the market selling at a loss, before finally turning profitable in 2010.

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From The Chatty
  • reply
    May 9, 2013 9:30 AM

    Steve Watts posted a new article, PlayStation 4 won't require 'major loss' like PS3, says Sony.

    The PlayStation 4 will not incur a "major loss" like the PS3, thanks to Sony spreading out its manufacturing process to partners instead of handling so much of the Cell investment itself.

    • reply
      May 9, 2013 10:37 AM

      So instead of it costing around $800 to build a launch PS3, It'll only cost ~$500 to build a launch PS4? Seems like a good idea to me.

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      May 9, 2013 10:54 AM

      I think having the GPU and cpu on one die probably simplifies the motherboard and cooling requirements. Also they only need one kind of ram.

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        May 9, 2013 11:00 AM

        Didn't the PS3 launch with >220W of power at max? The current APUs are around 35W, so I'm certain that even the next ones will be less than 70W (8 APUs vs. 4) for just that component. Throw in the BD player and a few other components to complete the system and you're well short of the initial launch of the PS3 for power and heat.

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          May 9, 2013 11:07 AM

          PS 4 has a much beefer GPU than any of the apu's AMD is shipping. It's probably a very large chip.

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        May 9, 2013 4:16 PM

        You're right - but it's one hell of a lot of very expensive ram.

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      May 9, 2013 11:05 AM

      PS3 suffered from a shortage of parts for bluray drives IIRC which limited manufacturing scale and 360 faced a shortage of RAM (I remember reading they doubled the system RAM late in development at the behest of Epic Games) which had the same effect.

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        May 9, 2013 4:09 PM

        Is "behest" used correctly here?

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          May 9, 2013 6:42 PM

          Yes. It certainly is.

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            May 9, 2013 7:07 PM

            Thanks...
            I had to check.

            I thought the meaning was "contrary to the will of"

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              May 9, 2013 7:10 PM

              actually it stands for "bro-request" so it was certainly placed by epic

    • reply
      May 9, 2013 4:18 PM

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