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?
No New Game Consoles
Hey guys great episode, lots to respond to, I agree with you Jonah on the perspective of those that way to hire people already working. It does make a person seem very disloyal but that doesn’t seem to be a valued thing anymore.
@Returns: I have no problem admitting to making bad choices so I don’t make up excuses either when returning something. Though most of the time it’s a faulty product for whatever reason. I think I’ve gotten myself to the point where I am very careful about impulse buying without ensuring I like or really need this. With Games I’m always trying to do the Demo or watch YouTube videos of a game, but I have had games bought that I wanted to return and now I even have some on my steam list. I may have to do some trading to clean that list up a bit.
@Gameplay versus Story: This seems a balancing act at times; there are games that had great story but painful gameplay (Legacy of Kain and Soul Reaver). Then games with great game mechanic but weird story like Eternal Sonata. It’s great when a game has both, I think story is the bitch as Paul said as so many a lot of times skip or ignore to get back to playing the game.
@Valve: I am glad they are doing this to help clean out some of the crap that seems to get through, in complete games and games that just should never have been started; I’m looking at goat Simulator there. I agree that you shouldn’t have to pay to beta test something. I do feel like this whole early access and beta testing is getting abused and allowing lazy game developing to happen. Beta testing is a skill set because you need people that are not only willing but actively look for ways to break a game or do things the game designers didn’t intend to happen.
@Sony getting hacked: On one hand I do want these companies to have better security for their customers but on the other it really isn’t right for hackers to be giving out password information either. I don’t trust these hackers motives either, and I am experiencing similar password changing/managing exhaustion as you guys as well.
http://www.geek.com/news/sony-just-got-hacked-doxxed-and-shut-down-1610274/
(I like the idea of a Pastabin, let’s do a Kickstarter for it)
@Game Devaluation: I wonder if Beyond Earth is considered a AAA game or not, since I got it digitally it was $54, nowhere near 35 much less 22. I think they’ve only recently been put on sale for lower prices for Black Friday, and of course it’s priced differently US, UK, EU and Aus all have different prices for said game. I do expect digital games to be cheaper than physical copies of the game. This also reminds me of an article where we maybe don’t value games as much as we used to due to very cheap prices and how easy it is to have a collection of a 100 games on your steam list and you’ve maybe only played a handful. That when we were children it was much harder to get a game, often you’d only have one and you played it bugs and all because that was your game. I’ve gotten a few of these bundled games and I have to admit I don’t feel the huge desire to play them much if at all. I don’t feel that same desire I did as a child when I would do extra chores and save up money just to buy ONE game.
@QotW: I would have to say my favorite Game based Cartoon would be “Where in the World is Carmen Sandiego”. I loved that she wasn’t a typical Villain, she seemed to encourage the kids to try and catch her and you were learning stuff about the world as well as being entertained. I also hated the way they depicted Simon in Captain N, I think I found the “Icky” Pit and “Mega” to everything very annoying, it could be that I was slightly older at the time 8-10 so I think that act was wearing thin. I did love the Zelda Cartoon but vote goes to Carmen for helping me learn more about the world around me.