Analyst Says Sony's PS3 Price Cut Will Not Be Enough

| 30 May 2007 16:51

A significant price cut on Sony's PlayStation 3 will still not provide consumers with enough incentive to abandon the blistering-hot Nintendo Wii, Bank of America analyst Michasel L. Savner told Business Week yesterday.

While a $50 to $100 price cut is widely expected later this year, Savner said the former figure was "meaningless" and the latter still not enough to impact the landscape.

""Based on our analysis, we conclude that a $100 price cut for the PS3 (we have dismissed a potential $50 cut as meaningless) would still leave the 'all-in' cost for a PS3 console and basic accoutrements 20-25% higher than the comparable Xbox 360, and does not even reflect the possibility that Microsoft could also lower its hardware prices," the analyst told Business Week, adding that in his opinion, a $200 cut is necessary - though unlikely.

He also chided Sony for its paucity of exclusive titles - something developers are more wary of given high development costs - and for putting too much stake in the idea that interest in BluRay would drive sales.

Savner also said Sony's woes would, on a "macro level," contribute to hardship for third-party developers, because so much ground has been ceded to Nintendo's platform, for which it remains "the dominant publisher."

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