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?
@Rushed next-gen consoles
You’re absolutely right that the media streaming functionality is painfully missing from the new consoles. I can only speak about the PS4, which is the one I got, but the fact that I can’t stream stuff from my PC to the PS4 is horrible. #FirstWorldProblems However, the backlog of PS3 games is deep enough that I don’t feel the need to box the console up anytime soon.
No CD playback was also something I couldn’t get my head around. It can’t be that expensive to implement… Is it a hardware or a firmware issue? Anyway, I rarely used my PS3 to play CDs – my stereo has a CD player so I use it instead.
Poland has never had much extra multimedia support. There’s no Hulu, no Netflix, no Amazon Prime… Even the YT app has been added just recently to PS3 in Europe (still missing on PS4). That’s why it’s not as bad here. I’m happy that the NHL Gamecenter App was available almost day 1 and I can watch the games on the PS4, even though it seems to be more glitchy than the PS3 version.
@Vita multiplayer
I played some LBP on the Vita and had some connectivity problems but not to the extent Jordan talked about. I played a lot of Killzone Mercenary, though, (Platinum, yo!) and it worked very well. Not laggy at all, usually full or almost full games. I played 100+ matches needed for the trophy and I got disconnected only a few times.
@Sony Santa Monica
I believe I heard in another podcast, but was to lazy to verify it myself, the studio is still hiring new people. One opinion I heard is that they’re not only trying to cut back on costs but also mix things up a little bit after the recent failures, i.e. GoW: Ascension. That’s why they laid off some people but will bring some new faces, although in limited numbers.
@QOTW
The arcades were not very popular in Poland in the 80’s and 90’s. I remember a wagon, similar to a cricus wagon, with some arcade games inside that we used to go to with my friends back in the day. I don’t remember many games, though but one of them was Cadillacs and Dinosaurs. There were also some Metal Slug machines. All the PacMans, Tempests and Defenders were slightly before my time, I guess, or this era of arcade games simply skipped the communist Poland in the 80’s. However, I remember playing tons of Terminator 2 pinball but that’s a different QOTW.
@Rushed next gen consoles: The more I hear about the lack of features and functionality of both the Xbox one and PS4. The more I am glad I choose to stick to PC gaming.
I think the aspect also that you talked about with people in charge not knowing or not liking their product is very telling of the state that these consoles have come to. They are out of touch with their customer base.
@Thief: This game is looking great from the LP video’s I have seen of it so far. I find it amazing anyone was under the impression Garret was some sort of assassin or warrior. That was an aspect I didn’t mind in the original series, you shouldn’t be fighting so getting caught and subsequently killed is the punishment.
Maybe those that think like that are those who are stuck in only playing action FPS games.
@Half-life: This is a series I haven’t been able to get into yet. but I could never figure out which was first Half Life 1 or Half Life 1 episode 1?
Freeman’s mind is awesome to watch as well. A fun way to do a LP I think.
QOTW: I love this question I used to spend many hours in various arcade games. I tried to avoid coin gobblers like Gauntlet, I would play those that had a end goal. Like Willow, Simpsons, TMNT, Xmen vs Avengers, Indiana Jones and Temple of Doom, and Dungeons and Dragons. I loved playing pinball machine games as well, and the air hockey games. Arcades just aren’t doing as well as they used to do though. We had one in my local mall called the Nexus that even had lan PC games but it shut down unfortunately.