Sony cuts PlayStation 3 costs by 35 percent

Sony has cut the cost of materials used to make its PlayStation 3 game console by 35 percent, according to market research firm iSuppli.

Sony cuts PlayStation 3 costs by 35 percent

It now costs $448 to make a PS3, down from $690

The components used to produce the second-generation of the PS3 console cost $448.73, based on October component prices, iSuppli said, citing a recent teardown of the system it conducted to see what components are used inside. The market research firm then assembled a bill of materials based on that list of components and estimated prices to arrive at a system cost.

By comparison, the components used inside the first generation of the PS3 cost $690.23, based on mid-2007 prices, iSuppli said.

Sony makes a loss on the sale of each PlayStation 3 console, which sells for $400. But the loss Sony records for each console is narrowing, and the company may soon reach the break-even point, including other costs associated with manufacturing and sales.

"The PS3 may be able to break even in 2009 with further hardware revisions," iSuppli said in a statement.

More PlayStation 3 News

Sony managed to cut the material cost of the second-generation PlayStation 3 by using more advanced components. In particular, the consoles use a more advanced version of the Cell processor and other chips made using a 65-nanometer manufacturing process, instead of the older 90-nanometer process. This shift reduces unit manufacturing costs for each chip and lowers power consumption, which means Sony can use a less expensive power supply.

The number of components inside the PS3 has also been reduced, as functions previously handled by different chips have been combined in a single part, iSuppli said.

THE VERDICT by Blake Snow Blake Snow's Avatar Great. Now how about dropping that retail price. I say it's coming in Feb/Mar. Mark it down, everyone.

Comments [17]

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hiphophippy27

Hopefully when they break even they can make the PS3 like it was at launch; you know, with full hardware PS2/PS1 backwards compatibility.

My launch 60gb is still in best buy warranty and i'd hate it if for some reason I had to exchange my PS3 for a new PS3 that doesn't play PS2 games :(

Maybe this'll happen when the PS2 "dies"

BinStabbin

Sony just needs to give up on the video game market and concentrate on HDTV. Samsung is tearing them up in that department

monkbaine

I think Sony has taken a pretty good approach this generation. I don't feel they cared too much about being in last place with sales,because at the end of the day there are millions of people still buying the system,even at the "high" price. They have a great chance of breaking even this coming year,and if not I still have an incredible machine that gives me hours of satisfaction with my gaming and Blu-Ray collection

226999
mwendel

Don't forget that this is only Parts cost; this does not include the manufacturing costs involved in making the PS3.

No wonder they don't want to drop the price, but we're approaching that point where Sony is either going to eat it now to move consoles, or let the PS3 become this generations N64.

Kubrick

I assume they took out PS1 backwards compatibility and the ability to play PS3 games and it is now just a Blu-Ray player?

goofball

Feb will see the price drop to work alongside KZ2 launch. All Sony has to do is ADVERTISE. Something they have been doing shit of this generation

duffmanth

It'll be interesting to see the December sales figures for the PS3 when they come out next month. Whatever the outcome though, Sony is at the point now with the PS3 that they will have to cut the price of the PS3 or they will lagging behind for the next few years at least,

slime

Sony is not dead just yet they just need to realize people are not spending like they use to no matter how much it will hurt you if you want to save the PS3 cut the price. For example revive the 20 GB PS3 and sell it for $150 it's cheaper to produce an hey people will buy it.

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