PS3 Price Cut Coming?

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David Reeves gave an interview in British newspaper “The Guardian” yesterday in which he stated, amongst other things, that the PS3’s Cell processing chip was getting smaller and therefore cheaper to produce.

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“We’re always looking at ways to reduce costs, replacing the current 65 nanometre Cell chip with a 45 nanometre one probably in middle of year.”

This admission, coupled with the fact that Blu-Ray is getting cheaper to produce and the advice of every industry analyst outside of Sony’s walls leads to the assumption that the PS3 will almost certainly receive a much-needed price cut before the end of the year.

According to The Guardian David Reeves is more interested in increased profit, they state in the interview that:

“Reeves is adamant that SCEE can survive unscathed while resisting the urge to reduce and re-price as the 360 did last spring. For now, at least, he insists the label’s not for turning.”

Without quotes from the man himself to back it up and with, in my opinion, a lack of understanding for how the industry works.

The choice for Sony has always been to suffer bigger losses now in the hope of selling more games and recouping those losses later or to suffer smaller losses now and not have an install base that you can shift the profitable software to at a later time. It is my opinion, and the opinion of almost every industry analyst, that Sony need to cut the price and suffer those bigger losses in order to compete with their competitor in the lucrative Q4 games market.

Of course, Sony will deny a price cut right up until it is imminent because if you knew that the PS3 you were about to buy would be $100 cheaper next week you’d probably wait wouldn’t you?

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