Sony Corp.'s heavily anticipated PlayStation 3 game console is proving to be a heavy investment for the electronics maker. The PS3 may not appear in key markets at all this year, and could initially
cost Sony an estimated $900 per unit to produce, according to investment firm Merrill Lynch. Analysts said the price per unit would fall to $320 after about three years. Game companies need to make up
for such losses through the sale of software. This talk of a delay is not particularly good news for anyone in the video game business (except maybe Microsoft), as game sales continue to flag during
this transition period to the next generation of consoles. Advertisers, who are arguably the medium's most eager newcomers, will be disappointed because there had been a lot of talk around this time
last year about developing standardized ad units and measurable demographics for these next-generation systems by now. Nielsen Interactive Entertainment, which will be supplying that data, will likely
have to wait even longer to get its system running--probably not until mid-2007. Even so, none of this delay talk comes directly from Sony. As far as the electronics giant is concerned, the PS3 is
still slated for a spring '06 launch. However, analysts say there is no way Sony will be ready to go by then. A possible delay affects not only Sony but also game publishers, as well as chip and
accessory makers.
Read the whole story at Financial Times »
