Kutaragi refutes $1 billion PlayStation 3 hole will bring SCE to its knees

Any Gamer knows- that the power of Playstation 3 will be staggering. Xbox- though powerful ( hey I even bought a couple of them) will be pale in comparison. It also boils down to the library of games available for the platform

I can GUARANTEE that Playstation 3 will release to more than just a handful of games. The problem with the Xbox was always the quality / number of games ratio.

And wait a minute - how about BlueRay? 25gig DVD built into the system? I mean- for the meager cost of the unit I think that I will buy a number of them just for the ability to play High Def movies

Any gamer, with a bit of brain in his head, knows that power doesn't tell the whole story, not even by a longshot (you have to consider bottlenecks in the hardware, more power= higher prizes= possible lower marketpenetration ect.).

Cell is Sony's gamble (bigger then Nintendo's one) for the next 5 years, if it fails Sony is bankrupt, will be split up and sold to the highest bidder.

Blu-Ray isn't that big of a gamble but could hurt Sony enough to also go bankrupt if it fails to win over HD-DVD (or that holographic disk they got going). There is a very good chance that while the PS3 sells good, even be the marketleader but that Sony would still go bankrupt because they can't recover the costs. R&D is one, building special factories for producing Blu-Ray readers is another one (goes into the hunderds of millions) then special factories to build the PS3 's Cell (yes there are different kind of Cell-chips, the one going to be used in the PS3 does not have those "Skynet" communication properties Sony likes to rant about) again hunderds of millions...

I can understand why Sony is not going to put up a online infrastructure like Xbox Live... it cost Microsoft billions to put it up and is the second reason (behind the in-built harddrive) why MS has been losing a billion a year over the Xbox-project.

Unless you have such unique features and strong brand you can command a higher price (I think that Sony can charge nearly whatever they want and it won't hurt them too much).



Cell isn't just Sony's gamble though. And it's not just a gaming gamble. It's an IBM gamble too - and IBM rarely make mistakes. And it's going to be used in almost every consumer electronics market Sony is involved in. That's a lot of markets, and IBM will expand Cell's range far beyond Sony's markets...

I will bet you that Cell will make Sony, IBM and company a huge profit. They have the potential to refine the architecture and use it in basically any electronics kit.



Sony will not go bankrupt. Investors would simply rescue it.

I think it would be safe to say that HD-DVD has lost now, with more major Hollywood studios supporting Blu Ray. Some converted simply because the drive will be in the PS3. (This ignores the possible senario of Sony making the mistake of prohibiting porn... ;))

Remember again, this isn't just gaming. Blue Ray has wider implications beyond and into the whole areas of film, computing etc - and in all of those Sony has massive power and support and can use Blu Ray in more than enough products to justify the investment.



If it would provide them with a method to distribute media into homes through PS3, Sony set-top boxes and Blu Ray players, PSP, Sony MP3 players etc, then I think it's safe to see Sony investing heavily in online facilities, but only when it's worth their while.

Remember, Sony isn't a gaming company, it's a consumer electronics and media giant.

Yup. I too believe that HD-DVD is a dead duck. As for the pornography, I doubt Sony would prohibiting it given its attitude to porn on UMD.

Maybe i didn't imply it enough but all the stuff i said in the last post is all based on huge "IF"s. That's why i said "possible lower market penetration". I'm studying history so what I write that implies to the future is always a possible, potentially scenario, i know there is also the complete opposite that's possible. But it's always nice to have someone making the nuances.

IBM does take risks, they tried to launch a low-cost PC once, it failed miserably. Thing is Cell is a huge risk for all companies involved (Sony, IBM and Toshiba) because Sony is a company that's getting its ass kicked in every bussiness it has once entered. iPod and iTunes (and piracy) cuts in their music division revenues big time. LG and Pioneer and Philips are stealing more marketshare every year from Sony's electronics division (which runs on a HUGE loss) and Sony's movie division only makes a profit when a new Spiderman movie has been released.

If i did a SWOT-analysis on Sony it wouldn't look good (remeber that Sony is a company with 60 billion dollar debt and is making losses every year). But true their brand name and marketing are very strong but that doesn't mean that investors are just going to jump in the hole. Most feasible scenario if the Cell doesn't deliver is that Sony gets carved up and its divisions get sold seperately (there were allready talks that its movie division was going to be sold). What will investors go after? Not the electronics division, more like the movie and game divisions.

You know how Microsoft and Sony want to control our living rooms with their consoles? Sony wants to control it the hardware way (MS the software way), your TV, DVD-player, stereo ect. and since it invested so much money in Blu-Ray it's going to try to make you buy as much audio and movie Blu-Ray stuff as possible, huge online service from Sony delivering content... not very likely, not with the financal situation they are in now.

IBM is good at risk. OS/2 Warp. The old processors that were supposed to compete with Pentiums and K5s.

A lot is riding on PS3, and I kinda want to see it fail because of that. It'll clear up a lot of stuff; Blu Ray has issues, I keep hearing off various techy magazines, and the stats for PS3 show major memory bandwidth issues. Most people are very happy with DVD, and will be highly reluctant to trade up. HD is not as popular an idea as some people like to think. The cooling on it seems insufficient; all there is is some square holes at either end, and the power supply's internal (you can tell by the power socket hole). And that design is repulsive.

I really find it hard to wish them luck, especially after that quote.

they will make back what they say they lose just on all accesories,games,toys,they will have it live right they will bank it.

they will dominate the game industry completely

Great... you see that... that Cell chip is going haywire allready... posting dominance all over the forums. No one ever saw Terminator 3 or something?

Dude, chill and have some pie.

Overall, I think Kutaragi is been arrogant in his statement, basically he’s telling the board and everyone else, he’s going to sell PS3 at a price that is going to make them back their money and keep Sony Corp from going bankrupted. Can you guess who is going to cough up the money to do that--everyone that loves their PS1, PS2 and has held out from buying a DOSBox1.5. Sony’s consumer electronics are getting beating to death by the Korean Samsung and LG (Lucky Goldstar). Sony financials look bad, the marketing for the PS3 launch is going to put them over the edge, and the Blue Ray disc manufacturing equipment is going to further propel their launch over that cliff of death (They might make some money back in BluRay licensing.) Regardless of how much they have spent on R&D, or will spend on marketing and manufacturing this is a win or die situation for Sony Corp. (Although, being one of the older Japanese companies the government might step in and save them.)
Now to some random tangents:
1. Sony isn’t manufacturing the actual chip they are using, NEC is responsible for that (NEC is also making the chips for Nintendo, and IBM’s MS chips.) IBM is manufacturing the Super Computer version in their new factory, somewhere in Upstate New York (I forget where exactly)
2. The Cell is huge risk for IBM, Toshiba and Sony. If Sony goes bankrupt, they arent going to be putting the Cell into anything. The patent technology for CELL will probably be the first thing they sell off.
3. If you didn’t know IBM is the leading Super Computer manufacture in the world, it receives government subsidies, like Lockheed Martin, to NOT sell its products to certain countries, groups, or Company’s. If you don’t know IBM sold its consumer PC business to Levono (Chinese Company.) They aren’t planning to put it in your Thinkpad ladies and gentlemen. The Super computer properties of CELL come to risk at the quantum physics and electrical engineering level, its not just a “oops, just turn it up a little and it will work problem” . What I can understand from my physics/engineering guys about the Cell. Those, “Super Computer” properties come at a lot of power and a lot of cooling, correct me if I miss understood this, the CELL chip being manufactured at the current 45nm chip is the smallest you can go before you start getting quantum interference or something of that sort (basically atoms and electrons start to interfere with the workings of the chip.) When you turn up the power all that electricity pumping through chip actually magnetizes the chip, increasing the chances for interference.

He seems to have joined for 2 reasons: to try and sell his domain name and to troll.

PLEASE DO NOT FEED THE TROLLS.