Sony boss Sir Howard Stringer has basically told Activision to “nick off” after the gaming software publisher told Sony to cut prices of the PlayStation 3 because the $400 console is unprofitable. They also threatened to stop making popular games such as “Guitar Hero” for the Sony platform.
Activision CEO Bobby Kotick, who has obviously seen Sony’s pricing in Australia, has said that Sony’s Playstation 3 consoles which in Australia is 45% dearer that the US, are expensive and “over priced”
“He certainly likes to make a lot of noise,” Stringer, 67, said in an interview yesterday in Sun Valley, Idaho. “I lose money on every PlayStation I make.”
According to Bloomberg, Daniel Dematteo, head of GameStop, the world’s largest video-game retailer, said recently that that console prices are “too high” given the economic environment. Revenue in the U.S. video-game industry has fallen for three consecutive months, according to data compiled by research firm NPD Group.
In Australia the PS3 ,which sells for $687, trails the Wii and the Xbox 360 in sales. The Wii sells for $395 and the least expensive Xbox costs $299. Sony cut the price for the PlayStation 2 in the U.S. in March and in Japan but not in Australia.
Bloomberg said that the game unit has been Sony’s biggest money-loser during the past three years, accumulating $5.5 billion in operating losses. The deficits began after Sony introduced the PlayStation 3 in the fiscal year started April 2006. Operating profit is measured as the value of sales minus the cost of goods sold and administrative expenses.