But Sony still lost a lot of money on each unit sold.
Way back during the 2006 Electronic Entertainment Expo, Sony dropped a most-unwelcome bombshell on the gaming public: at $499 for a 20GB model or $599 for a 60 GB model, the PlayStation 3 would be one of the most expensive game consoles ever. It did not go over well and instantly became an unflattering meme.
Now, nearly 10 years after the PlayStation 3 launched, former Sony Computer Entertainment America CEO Jack Tretton has finally admitted that Sony’s initial asking price for its last-gen console was maybe a bit too high.
Speaking with IGN (via CinemaBlend), Tretton owned up to the fact that “because of the Cell processor and all the proprietary technology, it was difficult to develop for, it was difficult to manufacture, it was extremely expensive to manufacture. So at the price it came out at, everybody knew that wasn’t a consumer-friendly price. Amazingly, that was losing a lot of money for Sony, even at that price.”
That the PS3 was initially priced too high compared to the $250 Wii or $299 to $399 Xbox 360 is not a revelation, nor is the reality that the Cell processor was to blame for the bloated price. Both have been accepted as fact for years, but this seems to be the first time someone who was a high-ranking Sony executive at the time of the PlayStation 3 announcement has owned up to as much.
Of course, Sony did eventually get the PS3’s price down to a very competitive level, which helped it make up ground on the Xbox 360, a console that pummeled it in sales during the first few years of the previous console cycle. But Sony was stuck with Cell for the entire generation. It was an extremely powerful processor for a console at the time, giving the PS3 clear technological advantages over the Xbox 360, but it was also completely custom and extremely complicated. That latter fact made made it challenging for many developers to take full advantage of the console’s power, which all but negated Sony’s advantage.
The high cost of a custom, advanced processor wasn’t the only reason the PlayStation 3 was so expensive, though. It also had a Blu-ray player, another advanced and costly technology for 2006, inside of it. Interestingly, in 2017 it will be Microsoft who has the most advanced (and likely most expensive) games console and Blu-ray player, with its Scorpio console set to pack in 6 teraflops of processing power and a 4K Blu-ray player. Sony’s PlayStation will not feature 4K disc playback and has only 4.2 teraflops of processing power. It’s set to cost $400.