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'We knew we were gonna land cheaper than those green guys'
'We knew we were gonna land cheaper than those green guys'
June 11, 2013 | By Mike Rose

June 11, 2013 | By Mike Rose
More: Console/PC, Business/Marketing, E3

"We kind of had a feeling; we kind of knew we were gonna land a little bit cheaper than those green guys."
- Scott Rohde, Sony's VP of Worldwide Studios, has told Polygon that the PlayStation 4 pricing and used games policy were not direct responses to Microsoft's Xbox One.

After Microsoft revealed yesterday that the Xbox One will costs $499 at launch, Sony then went on to tout a $399 price tag for its PS4.

Rohde says that Sony had set this price in stone well before the event, and had nothing to do with the Xbox One pricing. "When [the Xbox One pricing] was verified this morning, we've just been walking around with smiles all day," he said.

And Rohde also says that Sony's used games policy was not a reaction to the Xbox One's restrictions. "That was always our plan," he noted. "It's something that we believe in. We know gamers come first; we know what they want."

He continued, "I was personally overwhelmed with the massive explosion on Twitter, with everyone essentially begging, 'Please don't do this Sony, please don't do this PlayStation!' It was so hard not to say, right away, 'Well, we never were going to do that, but now let's have a little fun and announce it in a fun way at the PlayStation press conference.'"

However, this appears to conflict with the thoughts of Adam Boyes, who heads up its publisher and developer relations teams. Boyes tweeted thanks to the individual who organized the #PS4NoDRM campaign, and when asked whether there was ever talk in the Sony camp about utilizing DRM, he answered, "There was a ton of conversation absolutely."

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Merc Hoffner
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To be honest, outside of the context of the Xbox One, $400 was about the maximum that the market would have accepted in any case. We're treating it like a win, but this is the very top of mass market pricing, perhaps even beyond. And I'm quite confident they're making some painful sacrifices to hit that mark.

Keith Thomson
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The main one being that they took the camera out and put it as a separate item. Given that the rumor with the camera was $430-530, that probably brought their base price down to the $400 mark. The lack of a higher end model announced may be another point.

Kujel s
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They must be taking a hit at this price and if this thing does't fly off the shelves (which I suspect will be the case) they are going to take losses they can ill afford, I smell another dreamcast coming.

Eric Pobirs
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I'll be very interested in seeing the teardowns and bill of materials assessments that appear when new devices hit. The two machines are so similar in so many ways that one has to wonder which carries the greater loss per unit at its respective price.

On one hand, Sony's core silicon is a bit more expensive in exchange for a greater number of GPU cores. But Microsoft's Kinect hardware and HDMI passthrough likely more than make up for that.

Both companies are in this for the long haul but Sony, considering its overall condition, has to be feeling the pressure to delivers profits. Then there is the question of how each machine's costs will scale down over time. The added GPU real estate in the Sony should become a minor cost over the course of die shrinks. It's harder to estimate this for the Microsoft side.

Either way, Microsoft has a hard job ahead of it making its value proposition understood by the market. To me, the internet connection is no big deal, especially in exchange for the greatly enhanced account portability. This may be hard to convey to much of the market.

Keith Thomson
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I doubt Sony's core silicon is more expensive. Microsoft made the mistake of 32mb of ESRam which would have eaten up any savings from those 6 GPU core units (33% less GPU cores than the PS4) they lack. ESRam takes a lot of silicon real estate, and a full 30% of the XB1 APU is ESRam. (From their own 5 billion transistor figure.)

Also, Sony's chip is based on a GPU with 20 CU's, and they're only utilizing 18 of them. That means they have 2 they can fuse off to save otherwise defective chips. I haven't heard of anything on if the XB1 chip has any redundant unused parts that can be used to save a defective chip. That means more expensive silicon because of lower yields.

Merc Hoffner
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I was actually pretty shocked about this. I thought Nintendo still had the license on the pseudo SRAM tech, so there was no way the Xbox could have 32MB truly embedded, or they'd figured out some work around. If the rumors of their yield problems are true then I guess I was wrong: They're just nuts! If there's the possibility that some of their image DSP tech is sitting on that GPU as well...lord help them, maybe they're sitting on a 3 billion transistor die. We're talking 7th gen troubles all over again. A part that was internally expected to cost $130 dollars might end up costing +$300 in the early days :-O Boned.

Bob Johnson
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Going to be tough. MS now needs to prove KInect etc is worth an extra $100.

ON paper their plan sounds fine. I mean Kinect will get them the kids market. HDMI in will get them the non-gamer market. And exclusives will get them gamers.

That's the plan in a nutshell.

But then throw in pricing and maybe they tried too hard to be everything to everybody.

The kids market seems sensitive to pricing. $500 is a lot. Kinect titles didn't seem to be big hits with kids. Kinect seemed like a novelty. And a last-gen novelty at that since most of its 24 million units sold last-gen sold into the US market which is a substantial market penetration for this space. And these sales were all late last-gen sales. Not like people have had new kids and they are now 6-10 years old since Kinect came out.

The HDMI in stuff seems like a stretch too. $500. Still need a cable box. That non-gamer crowd is probably going to stick with a new iPHone or iPad. YOu could check Fantasy Football stats and get updates just as conveniently as easy on those devices.

Kinect hasn't been huge with gamer gamers from what I read. And so all it does is jack up the price another $100 for that crowd.

But one knows quite how the games will be received. MS has some good exclusives or so it seems like. An oldie like Halo and a new one like TitanFall both coming during year 1. If the latter is a massive hit do the faults matter?

But it isn't just the $100 extra for a nextbox. IT's the used game thing which is really just another price increase although the numbers are anyone's guess at this point. And then the Live fees. Yes both are going to be need to pay to play online. But at least for now it doesn't seem like Netflix etc is behind a paywall on Sony's end? If this is the case then another strike against MS.

Brett Williams
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My estimate is that you'll see Microsoft pull the subsidized model like mobile devices and sell a 24 or 36 month contract for Xbox One including Xbox Live gold. That'll bring the price to $15-20/mo which pretty much makes adoption easier for people that don't have disposable income in the $500 range for a single purchase.

While lowering the barrier to entry it will also allow them to lock in the $500 price for a couple years on launch purchases and then drop the price in 2014 for new purchases.

Just my thoughts.