Sony's Losses at $2.9 Billion

[modeps]

GamaSutra (http://www.gamasutra.com/php-bin/news_index.php?story=21964) has some troubling news about Sony Corp this morning. Originally projected to be somewhere around the $1.1 Billion mark, they've revised their projections to be up near $2.9 Billion.

Sony Corp. has revised its projected annual operating loss from a previously expected figure of ¥100 billion ($1.1bn) to as much as ¥260 billion ($2.9bn).

As previously reported, the loss will be the company’s first in 14 years and only the second in its history.

The strong yen and declining demand for its products in the current global economic environment were again blamed for the results. Previously, Sony had expected a ¥200 billion profit for the year.

Not so good!

[alienchild]

http://i169.photobucket.com/albums/u224/SaneMadness/Failboat.jpg

[Demo_Boy]

That is an epic loss statement.

Will Sony exit gaming?

[Zander]

That is an epic loss statement.

Will Sony exit gaming?

Extremely doubtful.

Although Sony’s games division is still struggling to turn a profit, after previously being one of the company’s most profitable areas, the main problem continues to be television sales. Digital camera and video recorder sales have also disappointed, with even Sony Pictures underperforming.

I have a 55" Sony LCD Projection TV I bought 2 years ago. Image Block went out on it (as they so often do) JUST within the warranty. This will be the last Sony TV I own.

After reading the article it seems the games division will experience deep staff-cuts but no mention of dropping any lines.

[Virtuoso]

That is an epic loss statement.

Will Sony exit gaming?

Why are people seriously hoping for this? Less competition is BAD for GAMERS.

Yes, the PS3 is the loser this generation, but the GC tanked last generation and look at where Nintendo is now. People hoping for the failure of a console manufacture are unbridled, ignorant dicks.

[Dibbler]

I wonder how much of this is related to their television / home theater divisions. Sony used to be the best of the best in television and Samsung was the korean junk that poor people bought. Now the tables have turned and the Koreans are making the good stuff. Reminds me of the days when RCA and Zenith were to big dogs and Sony was the new guy on the block with the cheap TVs. What comes around, goes around.

Wow, I'm feeling old now.

[Virtuoso]

I wonder how much of this is related to their television / home theater divisions. Sony used to be the best of the best in television and Samsung was the korean junk that poor people bought. Now the tables have turned and the Koreans are making the good stuff. Reminds me of the days when RCA and Zenith were to big dogs and Sony was the new guy on the block with the cheap TVs. What comes around, goes around.

Wow, I'm feeling old now.

Whats Zenith? RCA is that Walmart brand, right?

[ackbrack]

I can't imagine them doing anything that could hinder whatever growth they can squeeze out of the games division. Given that the PS3 not only generates sales (though not profits) when the console is sold, but also can bring in money from games, BluRay disc, and direct download sales, they'd shoot themselves in the foot by cutting that part of their business.

[Demo_Boy]

PS. I don't hope the PS3 fails. I own a PS3, some portion of my livelyhood comes from a PS3 marketplace. I think the PS3 is the better hardware than the XBox.

So it was more of a DOOM question if PS3 would be dropped.

Maybe I should reposition some product that I am working on...

[Mr.Green]

Why are people seriously hoping for this? Less competition is BAD for GAMERS.

Yes, the PS3 is the loser this generation, but the GC tanked last generation and look at where Nintendo is now. People hoping for the failure of a console manufacture are unbridled, ignorant dicks.

You tell them!

[reptilezero]

my ps3 doesn't get much use game-wise, but it is AWESOME for dvds and bluray. Excellent picture quality. I've been playing the PS2 a lot lately, and I really think sony should have just extended that hardware in the same way nintendo extended the gamecube hardware into the wii. would have helped with developers since they were used to the old platform, and backwards compatibility would have been free.

[Borys]

Every generations needs its Gamecube.

Saturn, Gamecube, Playstation 3.

Next generation also will have one.

[Giles Brash]

I want to see Microsoft take the next hit, but I know they won't. Its funny how loyal we are even after the failure rate of our boxes, that most of us will likely end up buying the next iteration of them. I hope that, if anything, Micro$oft learned some hard lessons this generation and should be able to apply them to the next.

I still can't wait to buy my PS3, and sometimes I regret selling my Wii... sometimes.

[Vandenh]

I want to see Microsoft take the next hit, but I know they won't. Its funny how loyal we are even after the failure rate of our boxes, that most of us will likely end up buying the next iteration of them. I hope that, if anything, Micro$oft learned some hard lessons this generation and should be able to apply them to the next.


MS just posed a net profit of $4.17bn. You can say many things about MS... but they know how to run their business. They got hit hard with the original XBox and changed their tactics.

[yerok]

[QUOTE=Giles Brash;1706118]I hope that, if anything, Micro$oft learned some hard lessons this generation and should be able to apply them to the next.
QUOTE]

They lost more than a BILLION dollars to extend the warranty and fix the hardware issues. They continue to lose money to repair RROD issues. You can bet with that much financial pain there are lessons going 'round.

[Hitoriga]

I don't know why people think their Electronics department is losing money considering its currently their biggest profiters ever since Howard Stringer came in and tore down the "silos". Bravias sell like hotcakes despite what people say and the their TVs are not crap. Read a little more about TFTs and how they are manufactured before you say that. Probably the only division losing money is their Gaming Division whilst every other division is actually making money. It use to be the other way around, but Howard has made a lot of changes. These recent loses are not his fault nor the current Sony's fault as it is legacy decisions (such as PS3) and the recession that has caused them to lose so much.

[Zander]

I don't know why people think their Electronics department is losing money considering its currently their biggest profiters ever since Howard Stringer came in and tore down the "silos". Bravias sell like hotcakes despite what people say and the their TVs are not crap. Read a little more about TFTs and how they are manufactured before you say that. Probably the only division losing money is their Gaming Division whilst every other division is actually making money. It use to be the other way around, but Howard has made a lot of changes. These recent loses are not his fault nor the current Sony's fault as it is legacy decisions (such as PS3) and the recession that has caused them to lose so much.

Did you actually READ the gamasutra article?

[blackzc]

Whats Zenith? RCA is that Walmart brand, right?

If you were born in 87 you should know zenith. They were around well into the 90s.

[blackzc]

Crap, i forgot no edit.

I dont know that i would really mind if sony got out of video games. Im not a gran turismo junkie anymore. The reason why is once the economy rebounds worldwide it would be nice to see a new company that is totally focused on video games instead of part of a overall strategy of a bigger company.

But i have no fanboy feelings either way.

[Roc Ingersol]

If Sony got out of gaming (which they're not going to do) Microsoft would start treating gamers the way it treats Windows users.

You do not want that happening. Even if you don't like a single thing Sony has on offer, if you like games you do not want Sony to leave gaming.

Back in reality though: it's just not going to happen. Even bleeding money from high costs, the PS3 can keep its head in the race and pull down some net profit. Sony doesn't have many divisions with that bright of a future and is certainly in no place to just give up on recouping the billions already invested. The only industry they might exit, is the financial/insurance crap.

[blackzc]

If Sony got out of gaming (which they're not going to do) Microsoft would start treating gamers the way it treats Windows users.

You do not want that happening. Even if you don't like a single thing Sony has on offer, if you like games you do not want Sony to leave gaming.

Back in reality though: it's just not going to happen. Even bleeding money from high costs, the PS3 can keep its head in the race and pull down some net profit. Sony doesn't have many divisions with that bright of a future and is certainly in no place to just give up on recouping the billions already invested. The only industry they might exit, is the financial/insurance crap.


I agree about the MS stuff but SONY sure can leave gaming. SEGA, NEC, SNK, ATARI all did and thats just in 25 years. Some were bigger than others but really noting last forever. Sony will do a PS4 but if they don't improve it would be silly to stay in. And hardcore gamers are dropping like flies.

[ResistanceAddict]

Every generations needs its Gamecube.

Saturn, Gamecube, Playstation 3.

Next generation also will have one.

Every time I stop and REALLY think about it, the fact that the Wii is the clear winner this generation just makes me laugh out LOUD.

[Sloth]

Why are people seriously hoping for this? Less competition is BAD for GAMERS.

Yes, the PS3 is the loser this generation, but the GC tanked last generation and look at where Nintendo is now. People hoping for the failure of a console manufacture are unbridled, ignorant dicks.

There would still be competition among game developers. In my short time working for a game studio, what i've seen as the biggest hurdle and time spent is making the same game work on two or more platforms. I think gamers get lower quality games because so many dev cycles are devoted to compatibility.

[ResistanceAddict]

There would still be competition among game developers. In my short time working for a game studio, what i've seen as the biggest hurdle and time spent is making the same game work on two or more platforms. I think gamers get lower quality games because so many dev cycles are devoted to compatibility.

It doesn't matter what anyone says about the PS3, try to think of an alternate reality where all there is is the 360 and the Wii... kind of a strange thought...

[shpankey]

I'm honestly glad this is all happening to Sony. They were so f'n arrogant last gen and the start of this gen. They needed to be humbled in a big way. Hopefully they will learn from all this and get their shit together for next gen.

[Pluvious]

http://img.photobucket.com/albums/v133/Pluvious/fail_pics.jpg

[oldjadedgamer]

Why are people seriously hoping for this? Less competition is BAD for GAMERS.

Yes, the PS3 is the loser this generation, but the GC tanked last generation and look at where Nintendo is now. People hoping for the failure of a console manufacture are unbridled, ignorant dicks.

No one wants the PS3 to be a total failure but people want to Sony to hear loud and clear that we don't want a $599 system at launch and to keep their movie format war away from our gaming systems.

[ElfShotTheFood]

At least now we know how much Killzone 2 cost.

[riposte101]

I want to see Microsoft take the next hit, but I know they won't. Its funny how loyal we are even after the failure rate of our boxes, that most of us will likely end up buying the next iteration of them. I hope that, if anything, Micro$oft learned some hard lessons this generation and should be able to apply them to the next.

I still can't wait to buy my PS3, and sometimes I regret selling my Wii... sometimes.

One thing about Microsoft is that when there is competition, they are very good at learning from their mistakes.

[TeeCakes]

If Sony got out of gaming (which they're not going to do) Microsoft would start treating gamers the way it treats Windows users.

You do not want that happening. Even if you don't like a single thing Sony has on offer, if you like games you do not want Sony to leave gaming.

QFT. The day MS is the only horse in town for high-end video gaming is the day I submit to being a PC gamer, exclusively.

I totally think it's still too early to say that Sony's "10-year-plan" strategy has failed, IMHO. Being that we're only on the cusp of Year 3 and all.

[Trazzlo the Magnificant]

QFT. The day MS is the only horse in town for high-end video gaming is the day I submit to being a PC gamer, exclusively.

I totally think it's still too early to say that Sony's "10-year-plan" strategy has failed, IMHO. Being that we're only on the cusp of Year 3 and all.Just like when the last generation migrated to this one, it probably won't be Sony's decision when the "next-next generation" begins. Microsoft decided it was time for new hardware, Sony was caught short and haven't recovered.

Hopefully they come out with a viable PS4, I agree that the competition is good. But Sony will either lead the way, or be a follower again.

[oldjadedgamer]

QFT. The day MS is the only horse in town for high-end video gaming is the day I submit to being a PC gamer, exclusively.

Is this a joke post? You're saying that if Microsoft is the only horse in town for console games that you will submit to using PC games only... where Microsoft is the only horse in town?

As a devout Mac user I have to say that you MS haters who exclusively use Windows are an odd bunch.

[3Suns]

I just want to say one thing. Sony is blaming their situation in part on the strong yen and that is total bu!!sh!t. This summer, traveling back to Canada, I had to deal with a yen so weak, I could hardly buy clothes to put on my back. It wasn't until the beginning of October that the yen finally grabbed some balls. Throughout the '90s, the yen was much stronger than it is now.

I am so sick of hearing that excuse. It isn't the strong yen, it is the fact that they put ALL THEIR EGGS IN ONE BASKET. And that basket cost $600 and nobody wanted to buy it (contrary to what the executives at Sony thought everyone would be scrambling to do). THAT is why they are losing their shirts and the shirts of their employees.

[Mr.Green]

Is this a joke post? You're saying that if Microsoft is the only horse in town for console games that you will submit to using PC games only... where Microsoft is the only horse in town?


Logic is to Teecakes what snow is to Africa.

[DeathtollWRX]

This is troubling news. I read an article today where Starbucks, Lane Bryant and other huge companies are ready to go under as well. This is a crisis on an epic scale and there will be no recovery... not for at least 4 to 5 years i'd say.

If the PS3 does end up going away you can forget Microsoft dropping the price of hard drives/controllers and just about anything else. I'm a hard core Xbox360 player/PC gamer but I knnow for a fact if the PS3 ceases to be relevant we are not going to see as many great games come out for the 360. Does anyone think it would be possible for Sony to make the ps3 less expensive to make? I think we need a PS3 slim minus some of the built in features they always ballyhoo about.

I for one will still buy Sony, I have been eyeing a 52inch Bravia for some time, I still feel that they make some of the best tvs out there.

I think Sony and MS need to come up with a way for people playing PS3 to see people online who are playing on Xboxlive. At least you can chat with each other and send messages. You wouldnt be able to play games but at least you will still have that online community to interact with. most of my gamertag buddies I rarely play games with but we do talk about them.

[oldjadedgamer]

If the PS3 does end up going away you can forget Microsoft dropping the price of hard drives/controllers and just about anything else. I'm a hard core Xbox360 player/PC gamer but I knnow for a fact if the PS3 ceases to be relevant we are not going to see as many great games come out for the 360. Does anyone think it would be possible for Sony to make the ps3 less expensive to make? I think we need a PS3 slim minus some of the built in features they always ballyhoo about.

There was a huge game industry before Sony and there will be a huge game industry after Sony. As the Dreamcast proved, even if one power player leaves there is always another company that will take their place.

Also, when PS2 had the vast majority of the gaming market and everyone else had barely any, third parties did just just fine. The industry will survive even if the Playstation doesn't and all the doom and gloom of the big bad MS taking over is silly.

Just wait for Apple to jump in with their new game system.

[Trazzlo the Magnificant]

I think Sony and MS need to come up with a way for people playing PS3 to see people online who are playing on Xboxlive. At least you can chat with each other and send messages. You wouldnt be able to play games but at least you will still have that online community to interact with. most of my gamertag buddies I rarely play games with but we do talk about them.None of these ideas help people play Wii Fit on PS3. Everything else is a Bandaid on a breaking dam. :p

[TeeCakes]

Is this a joke post? You're saying that if Microsoft is the only horse in town for console games that you will submit to using PC games only... where Microsoft is the only horse in town?

As a devout Mac user I have to say that you MS haters who exclusively use Windows are an odd bunch.

1) I use Windows, but don't necessarily pay for it :cool:. Other than for gaming, I'm a Linux man anyway.

2) MS has nothing to do with the PC gaming software I like, aside from developers using the Windows OS. The fact that MS has such a monopoly on the lackluster PC gaming market should be the first clue that a console gaming monopoly spells disaster.

[TeeCakes]

Logic is to Teecakes what snow is to Africa.

"Logics" should tell you that when most of the 360's "exclusive" titles come out eventually on the PC as better versions (Mass Effect, Halo, etc.) that buying a high-end PC > dealing with the limitations of console gaming.

But I guess you're made of green, so you probably would enjoy paying for XBL every year, being inundated with online ads, and dealing with shitty hardware instead of only paying for your internet once while using a custom-built PC as the superior online gaming device of choice.

[TeeCakes]

Yes, I'm making a triple post. Blame the lack of an edit button.

Just like when the last generation migrated to this one, it probably won't be Sony's decision when the "next-next generation" begins. Microsoft decided it was time for new hardware, Sony was caught short and haven't recovered.

Hopefully they come out with a viable PS4, I agree that the competition is good. But Sony will either lead the way, or be a follower again.

The continued success of the PS2, combined with the growing adoption of Blu-ray means that the PS3 has a nearly limitless amount of staying power. This is part of the reason why Sony was so content to eat a lot of their profits to put so many features into their pet project.

Regardless of whether MS puts out a $399 "361" within the next two years, people have already shown they are willing to buy more expensive, less technically impressive consoles (Wii =$249, Xbox = $199), and continue to support older consoles as an alternative to the expensive next gen.

I personally think it'd be a blunder for MS to jump the gun on the next gen. They've only barely been able to wash out the bad taste left in the mouth of gamers from the Xbox 1 being prematurely killed, and there's a lot more money to be gained from the current gen.

[Mr.Green]

"Logics" should tell you that when most of the 360's "exclusive" titles come out eventually on the PC as better versions (Mass Effect, Halo, etc.) that buying a high-end PC > dealing with the limitations of console gaming.

But I guess you're made of green, so you probably would enjoy paying for XBL every year, being inundated with online ads, and dealing with shitty hardware instead of only paying for your internet once while using a custom-built PC as the superior online gaming device of choice.

Thanks for proving my point.

[oldjadedgamer]

1) I use Windows, but don't necessarily pay for it :cool:.

So you're a thief. Thanks for clearing that up. Now I understand.

[modeps]

So you're a thief. Thanks for clearing that up. Now I understand.

I have no idea what his situation is, but I don't pay for Windows either... and I'm not a thief.

[oldjadedgamer]

I have no idea what his situation is, but I don't pay for Windows either... and I'm not a thief.

So Microsoft is giving it to you for free? I'm clueless. How do you get a free operating system when you build your own PC?

[modeps]

So Microsoft is giving it to you for free? I'm clueless. How do you get a free operating system when you build your own PC?

My place of business provides it to their employees.

[oldjadedgamer]

My place of business provides it to their employees.

Must be nice, giving a hundred dollar operating system to every employee for free. Some how I think that's an exception and not the rule for how people are getting their operating systems.

[balamoor]

No one wants the PS3 to be a total failure but people want to Sony to hear loud and clear that we don't want a $599 system at launch and to keep their movie format war away from our gaming systems.

True dat. :cool:

I will finally be picking up a PS3 soon for KZ II and a couple other PS3 only games (I really don’t need you anymore SONY as my Beloved RE now comes in 360 flavor) ...but my hope is the next system will have a competitive launch price with a hell of a lot less arrogance....if not myself along with millions of others will boycott that system, as well.

[Trazzlo the Magnificant]

The continued success of the PS2, combined with the growing adoption of Blu-ray means that the PS3 has a nearly limitless amount of staying power. This is part of the reason why Sony was so content to eat a lot of their profits to put so many features into their pet project.Success of PS2 is soooo last generation. The growing adoption of bluray has nothing to do with PS3, since it's not the thing for whom adoption is growing. Adoption for PS2 and PS3 are both down, and that rarely is presented as the winning scenario.

As more people buy their stand alone Bluray players, they can add either a Wii or a 360 to the system for less money than duplicating the bluray costs in PS3. The more stand alone players sold, the harder the increased price of the PS3 is to justify, and the gaming just isn't so stellar to change the formula.

[modeps]

Must be nice, giving a hundred dollar operating system to every employee for free. Some how I think that's an exception and not the rule for how people are getting their operating systems.

Its all about volume licenses.

[lost]

As more people buy their stand alone Bluray players, they can add either a Wii or a 360 to the system for less money than duplicating the bluray costs in PS3. The more stand alone players sold, the harder the increased price of the PS3 is to justify, and the gaming just isn't so stellar to change the formula.

Huh? A decent blu-ray player sets you back around £250/$300 does it not?

[TeeCakes]

Thanks for proving my point.

Somebody should've told you that replying only with 'witty' one-sentence pearls of sarcasm is a classic weapon of choice for forum-trolls. But don't bother trying to actually come correct with a legitimate response, you've already earned my disrespect, brother!

So you're a thief. Thanks for clearing that up. Now I understand.

Apparently you don't. Saying that it's not "necessarily" paid for doesn't mean that it's not being paid for. Without divulging specifics, I receive Windows free of charge thanks to Uncle Sam.

@Trazzmatazz - I only mentioned the PS2 to illustrate that MS springing a new console onto the market within 2 years shouldn't automatically spell doom for Sony's 10-year PS3 plan. People will still buy older consoles long after the next "next gen".

[oldjadedgamer]

Huh? A decent blu-ray player sets you back around £250/$300 does it not?

In the US you can get them for under $200 and on Black Friday they were some Blu-ray players even going for $130.

@Trazzmatazz - I only mentioned the PS2 to illustrate that MS springing a new console onto the market within 2 years shouldn't automatically spell doom for Sony's 10-year PS3 plan. People will still buy older consoles long after the next "next gen".

Exactly, look how many GameCubes were sold this Christmas season.

[Kolreth]

Must be nice, giving a hundred dollar operating system to every employee for free. Some how I think that's an exception and not the rule for how people are getting their operating systems.

Everyone who works in education in australia gets free Vista/Office/project/encarta for 'free' (they have to pay for cost of media). I imagine it would be similar in most other government departments.

[Trazzlo the Magnificant]

Huh? A decent blu-ray player sets you back around £250/$300 does it not?They had adverts for Christmas specials under $150US. So, the players are getting into that range, the regular price is just under $200 for them now (http://www.walmart.com/catalog/product.do?product_id=9864613).

[oldjadedgamer]

They had adverts for Christmas specials under $150US. So, the players are getting into that range, the regular price is just under $200 for them now (http://www.walmart.com/catalog/product.do?product_id=9864613).

This one has great consumer reviews, in stock, and even comes with an HDMI cable where the Magnavox doesn't.

http://www.amazon.com/dp/B0015313Q6/ref=asc_df_B0015313Q6695366?smid=ATVPDKIKX0DER&tag=mysimon-ce00-20&linkCode=asn

Actually, my mom just got a new HDTV maybe I'll get it for her.

[Ravenus]

Here's my thoughts... When I saw this title, I thought wow, that's a big loss! BUT, at the same time, I was aware of their investments into Bluray, which is what amounted to most of their losses, along with the horrible economy. However, this loss hasn't at all made me think, wow, I'm not gonna buy Sony anymore. Sony rocks my socks off!!! And probably always will. The only bad thing is that I know investors won't look at it this way, so they may pull money out of their stock which could hurt Sony overall, but they have soooo much money I don't think this will sink Sony at all. Plus, ummm Bluray is GENIUS!! And for those of you tech-noobs, go fucking buy one. The picture quality difference is literally like night and day quality. IT's AWESOME-O!!!.... on a 1080p TV anyway, with HDMI. DO IT!!!

[Ravenus]

[QUOTE=oldjadedgamer;1706836]This one has great consumer reviews, in stock, and even comes with an HDMI cable where the Magnavox doesn't.

Oh, and just so you guys know, most people don't, HDMI cables are a band-width based cable. An HDMI cable that comes in the box is gonna be shit, just like all cables that come in the box.

Think of it this way, you are paying for the actually product. Companies are not just going to throw in a $70 cable for FREE!!! The HDMI in the box is going to be around 2 Gbps (gigabytes per second). A Bluray disc can hold 50GB of data whereas a DVD only had 8 GB max. This is far more data which is why the picture and sound is exceptionally better.

Ok, so if you have a 1080p 120 Hz HDTV. Your TV needs that data as quickly as possible to give you the best picture and sound quality that your TV is capable of producing. Therefore, if you use the cable in the box, you are screwing yourself. Don't be cheap, and go out and get a HDMI rated at 10.2 Gbps. This will maximize the quality and give you the true experience you spent your money to get.

And this is just an FYI, you can skimp a little on the HDMI for your HD cable box because all HD cable sources only broadcast in 720p. This mean less data per sec. I still wouldn't use the cable in the box, but a 4.95 Gbps HDMI would be fine.

Anyway, moral of the story, you get what you pay for. DO NOT base you buying decision for a Bluray player on the fact that it has a FREE shit-ass HDMI cable.

"Now you know. And knowing half the battle!"

[lost]

What's the bandwidth on a component cable? Just because that's what I'm using at the moment.