Silicon Alley Insider has delivered a stinging rebuke to Sony’s marketing strategy for the PlayStation 3, calling the console a “sinking ship” as its sales continue to struggle.

PlayStation 3 sales are down about 19 percent compared to sales in November 2007, with 378,000 units sold last month versus 466,000 in the same period during the previous year. It’s the only major console to experience such a slip, and according to an article on Silicon Alley Insider (via CNN Money), the blame lies entirely with PS3 itself.

“The problem for Sony isn’t the recession, it’s the PS3,” the article says. “Microsoft put up respectable numbers with its Xbox 360, selling 836,000 units vs 777,000 in November 2007. And Nintendo’s Wii continues to dominate the market, more than doubling sales from 981,000 to 2.04 million.”

Three reasons are cited for the PlayStation 3’s slow-motion flame-out: Mainstream indifference toward the Blu-ray format, lack of an exclusive “killer app” and above all else, price. The cheapest PlayStation 3 is listed at $399 at GameStop, compared to $199 for the entry-level Xbox 360 Arcade or $299 for the more comparable Xbox 360 Pro with a 60 GB hard drive.

Sony recently launched a promotion offering $150 rebate to people who applied and were approved for a Sony PlayStation Visa card, but the Insider predicts that without “deep” price cuts across the board, the future of the PlayStation 3 is dismal. “Tell yourself the PS3 has superior graphics if it makes you feel better,” the report says, “but a $400 console with a mediocre game library simply cannot compete against an Xbox 360 priced at $200 in this economy.”

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