Only days after being criticised for selling expensive gaming consoles by Activision, one of the world’s leading gaming Companies Sony Computer Entertainment is now tipped to cut the price of the PS3 console by up to US$100. However, there is every chance that the price cut will not be passed on in Australia.
Leading US games retailer Games Stop has told analysts that they are expecting an imminent price cut as Sony struggles to hold onto sales for their Playstation 3 console that is struggling up against the Nintendo Wii and Microsoft Xbox 360.
According to Sterne Agee analyst Arvind Bhatia, who attended a meeting with GameStop executives, “Management believes that a meaningful PS3 cut is highly likely in the near-term. We continue to believe a $100 price cut on PS3 will occur around the launch of EA’s Madden NFL 2010, which is scheduled for release on 8/18.”
Yesterday we revealed how Activision Blizzard chief executive Bobby Kotick threatened to cut off support of the console because “it’s expensive to develop for the console and the Wii and the Xbox are just selling better. Games generate a better return on invested capital on the Xbox than on the PlayStation.
The problem that Australia faces is that SEC boss Michael Ephraim has, in the past, failed to pass on global price cuts. Earlier this year he refused “point blank” to pass on a significant price cut for the PS2.
An official statement from SEC Australia said at the time “The announcements made by Sony Computer Entertainment Europe today regarding PlayStation 2 (PS2) pricing does not currently affect Sony Computer Entertainment Australia. Pricing of the highly popular PS2 console in this market is already comparable as of 1 April; providing family fun at an affordable standalone retail price of AUD$199.95”
This is almost $65 dearer than the USA.
Several Analysts are also claiming that if Sony is forced to cut the price of the PS3, Nintendo and Microsoft will follow with price cuts for the Nintendo Wii and the Xbox 360.
According to Game Daily, Bhatia now says that the probability of a price cut (likely $50) on Nintendo’s Wii is going up. “Logically, if Sony cuts the price of PS3 to US$299, Nintendo may be forced to cut to maintain sufficient price differential versus the PS3 and 360. In other words, hardware sales, while slow now, are about to get a boost in the near-term driven by price cuts,” he noted.
The PS3 currently sells in Australia for $688.
