Every day we’re hearing of a company running through a round of layoffs or going out of business, it’s really not a happy time. Sony is not immune to the economic troubles either. Sony is talking restructuring and that involves a potential head count reduction of 16,000 jobs due to plant closings.
This leaves Sony with some hard decisions. Restructuring can mean drastic changes that effect all their product lines. The PlayStation 3 isn’t currently a shining example of high profit margins. The console needs time to reduce its overall cost, chip sizes and bring profitability. Is it in danger?
“Sony’s not in a position to halt all domestic production but it has to do something that drastic,” said Mitsushige Akino, chief fund manager at Ichiyoshi Investment Management. “If it announces plans to move production overseas while keeping only planning and development functions in Japan, that would be a positive.” (gamestooge)
The yen is losing value in our global economy making it more difficult to export the product and build any type of profitability plan. “A source said this month the company will likely suffer an annual operating loss of about $1.1 billion, its first such loss in 14 years” (news.yahoo.com) All this noise is making CEO Howard Stringer contemplate Sony’s involvement as a “software only” company, making us recall the changes at SEGA to this same result.
The Financial Times reported Sony will unveil details of its restructuring steps on Wednesday or Thursday. It said Chief Executive Howard Stringer was meeting with resistance from some executives to shifting the company’s focus to software from hardware and cutting jobs in Japan. (news.yahoo.com)
Is this just a case of a fearful executive trying to lay plans for a more stable future? Software is easier to develop, pays for itself quickly and becomes pure profit as it ages. Hardware requires constant upkeep at manufacturing facilities, chip reductions and a boat load of quality planning for first shipment. Would Sony go full software?
Let’s face it, Sony isn’t SEGA, they’ve been developing hardware for consumers since anyone can remember and they’ve been doing it with quality and market penetration. It seems absurd to think they’d forgo hardware designs in replacement of a full software solution to the problem. In addition, Sony has already invested a large amount of cash into seeing PS3 through it’s 10-year plan and letting that die now is realizing a huge loss on investment.
If Sony pushes through the economic and maintenance course, the PS3 will become highly profitable, much like the PS2 last generation (with a slower ramp up for sales). Even if they break even after ten years it seems a lot better than throwing all the effort away.
Perhaps Howard Stringer is talking “software” for the next generation home console? You think Sony will create a PlayStation 4?
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@PSvita loosing weight
I am not sure this is necessary. Especially since I hear this is more of a step back for the Vita. PSP needed a slim version because the original was chunky and had loading time issues. Is there anything so wrong with the Vita that needs fixing? Especially in UK? For me it’s a problem because I wanted to buy a Vita as it’s gotten quite cheap here. The new version will play havoc with local prices. I am not sure how this will play out.
@First the manuals. Now this.
I agree with Paul. The industry is not ready for discless consoles. And not just because people like hard copies. Major concern is that it requires a system of digital game sales on consoles that will actually work. At the moment, a digital game release costs almost twice the price of a hard copy. £60 for a new PS3 title from their online store as opposed to £40 for a disc. I am not OK with that. If digital stores were along the lines of Steam, this would work well. Otherwise it would just kill the used games market and force us to buy games at extortionate prices. On the account of the disc less Xbox I say meh. It will be an alternative that no one will buy. It will be seen as lacking compared to the standard Xbox one.
@Rescuscitation of the walking dead
The heads of Nintendo took a pay cut because it’s their fault Nintendo tanked. No one else’s. In my opinion they should have stuck the whole management crew into a space cannon and shot them to Alpha Centauri. The stubborn old fools will only damage the company further of they stay in power. This restructuring move should have happened a year ago. Instead Nintendo carried on as usual and sunk itself even further. Now it’s in dire straits and needs extreme measures. I hope that Disney buys Nintendo and makes Satoru Iwata work in one of their parks in a Micky Mouse suit. He deserves it.
@QOTW
Has to be Crysis. The game took a nosedive once the aliens started shooting everyone but the ending was of the shelf action movie crap. “A gigantic alien mothership is attacking. I wish we had a super mega ultimate secret weapon to shoot it down. Oh wait, it’s right over here.” Worst part was that the ending suggested that everything you just did was pointless and you have to go back to the island to “roll credits”.
Great Episode guys.
@Kotor II: I am with Jordan and I didn’t notice that it was unfinished, only that I was an overpowered character destroying everything in my path. I also didn’t find Kria impressive, just seemed like another whiney character who didn’t get their way and is taking it out on everyone else.
@Miner49er: I loved that you guys mentioned this game, I played it as a child and I had forgotten it’s name! I also played Jumpman Junior along with that one.
@Chocobo Tamagotchi: There was in fact a companion App game for FF8 on the Pocketstation. You played sd the Chocobo who got to fight monsters and collect treasure so it wasn’t too bad. It never came to America though.
@Black Isle: Speaking of Baldur’s Gate what do you guys think the chances are of getting the Baldur’s Gate 3 Beamdog is supposed to be working on? Did the Enhanced Editions do well enough?
@Facebook games: I find the whole Pay to win game mechanic to be very weak. More a ploy to milk customers of as much money as possible and give poor gameplay in return. I used to play Backyard monsters and it would constantly have stopping moments while I had to wait hours or days for things to finish building. It really can take the wind out of your sails to want to play. All the while giving the message “Save on resources by spending real money!” When I keep getting THOSE messages that tells me they don’t have any real game here just bait for you to click the Pay to Win. There was no real consequence to losing you could always easily recover. There just isn’t any challenge for these casual games.
Another example of a terrible Pay to win game is StarTrexels which has giant pay walls preventing you from going forward until you either spend HOURS collecting enough Dilithium or pay $15 to go to the next area.
So to answer Paul’s possibly rhetorical question, Yes I would rather pay for a 50-60 dollar game then deal with the Pay to Win crap.
At least Paul’s game Pinsanity sounds nice if you can actually win physical Pins and you are supporting our Olympic team.
@QotW: Best unfinished game would have to be Minecraft since they are still working on it.