Sony Computer Entertainment CEO Kaz Hirai confirmed in an interview that the new PS3 Slim is being sold at a loss, but said Sony’s overall game business is in good shape and making money.
It’s no great secret that Sony’s been taking a bath on the PlayStation 3 since the day it was released, despite the system’s not-quite-consumer-friendly price tag. News that the smaller, lighter PS3 Slim would debut at $299 (and that current PS3 models would also be reduced to the same point) had optimists wondering if maybe the company had figured out a way to make a little money on these things, but it can’t be any great surprise that Hirai says that’s still not the case.
“If you’re just talking about the hardware alone, the quick answer is yes,” he said when asked in an interview with the Times Online if the PS3 Slim was being sold at a loss. “That makes good headlines, but I don’t actually know that that’s the true nature of the business that we’re all in, whether it’s PlayStation, Xbox or the Wii. I think the better indicator is to look at the business as a whole platform, to ask: Are you profitable in terms of the hardware, software and peripherals. And the answer to that question is yes on a gross profit level since the last fiscal year.”
A desire to “reset the thinking” for consumers and also internally at Sony was symbolized by the new PS3 logo, he said. “We wanted to make sure that we set a new direction for the PS3. The PS logo with the capital P and small S has always been our logo, has always been synonymous with video games and I wanted to reset the thinking,” he explained. “On a practical level, when you have PlayStation 3 spelled out, the aspect ratio was such that if you wanted it on a billboard it became tiny. It didn’t work in terms of visibility.”
He added that the launch of the new PlayStation wasn’t a response to any failures in the original console, but rather a culmination of various technological improvements that Sony wanted to offer its customers. “We wanted to pass the cost savings on to our consumers, in the new price point as well,” he said. “We also felt it was the right time in terms of the great line-up of software titles we have coming out.”