Since the introduction of Sony’s Playstation 3, there have been outcries against the overpricing of their platform in comparison to their competing contemporaries. Many have argued that Sony has steered too far away from their gaming roots by seemingly trying to force feed consumers the blu-ray format which even though has created a buzz as of lately, was a major contributing factor in higher manufacturing cost. Despite the many concerns, Sony has been able to demonstrate that their brand name does carry a significant amount of weight. Just last year after dropping their price point by $99 for both their PS3 SKU’s and seeing a significant increase in sale volume, their nearest competitor Microsoft, was forced to drop the price of their Xbox 360 console to $199. Currently the Playstation 3 has grabbed the least amount of market share of it’s competitors, primarily due to their current price point. However, with rumors of an inevitable price cut, some are now speculating whether or not a price drop will matter.

When looking at the current worldwide positioning of the Playstation 3, there are many contributing factors that lends a hand to the Playstation 3 price drop making a serious splash for Sony. The Playstation 3 has multiple assets to it’s credit which allows for a more diverse affect on consumer needs.

Today it is easy to find a stand alone blu-ray player for as low as $175 and ever lower in a few cases. From gaming forums and journalist alike many have stated that because of this lower price point, millions of Xbox 360 owners will be more prone to purchase a stand alone blu-ray player instead of shelling out $399 for the Playstation 3. Well, while that sound very likely, the assumed price drop of the Playstation 3 to $299 does dramatically change the playing field. Eventhough is it not as prevalent as a year ago, many Xbox 360 are still malfunctioning and a large install base of Xbox 360’s on the market are older models and or refurbished models with expired warranties. Consumers want reliability at an affordable rate and at $299 these factors play in Sony’s favor as the blu-ray market is on the rise.

Blu-ray

Gone are the days of hoping that the high definition format can penetrate the market. According to NEILSEN, as of December 2008, 1 out of every 4 US homes has an hdtv.While there is still headway to be made, the infiltration of hd media is rapidly growing globally. The UK which as of lately has surpassed the Japanese market in total gaming revenue also has seen an increase in blu-ray sales. According to Blu-rayFreaks;

“Obviously the benefit of improved picture and sound, the various innovative extra features Blu-ray offers, plus the far more reasonable prices the discs can be purchased for over this time last year has made a clear impression on the public.  Comparing this Blu-ray data to DVD sales data from the same period of its life, shows Blu-ray to be selling five times the amount DVD did.” - BlurayFreaks

No one stated that Sony was force feeding consumers the dvd format when they launched the Playstation 2 in 2000 at a time when the average dvd player was well over $250. An eventual Playstation 3 price drop to $299 as a hybrid entertainment gaming console would undoubtedly drive consoles sales and the blu-ray market even further.

On the gaming front there is no denying the Playstation 3’s robust capabilities as the console of choice. As of today Sony’s 2009 software line-up appears to be unmatched by the competition. From multiple multiplatform titles, to an incredible exclusive lineup, the Playstation 3 future looks bright. Recently Sony released there mouth-dropping  first person shooter exclusive, KILLZONE 2 which according to NPD reports registered 323,ooo copies sold in 2 days in the US alone. Most multiplatform titles are also evenly sold across both competing next-gen systems despite a smaller install base for Playstation 3. Also it is interesting to note that the Playstation 3 sold 70,000 plus more console in February than January all while maintaining a $399 price point.  I guess the KILLZONE 2 hype was real. Again, how would a $299 price point change this. For the better of course. At $299 system selling software has far more leverage to push it’s respective console.

KILLZONE 2

The question, “Will a price drop even matter if the Playstation 3 continues to trail the competition?” has been asked. The simple answer is, absolutely. Whether the Playstation 3 trails or surpasses the competition this generation we only have to look at Sony’s console history to know that they are unmatched when it comes to console support. Just last month according to NPD the Playstation 2, a console which launched 9 years ago registered over 130,000 console sold in the US only. No offense but I can’t remember the last time Microsoft mentioned their original console. Why would they, it is obselete.

Soon Sony will drop the price of the Playstation 3. System software with unmatched exclusives along with the ever increasing blu-ray market will generate an incredible volume of sales. The price drop will drive the market and Playstation 3 users will have an ever increasing experience that is unmatched. Yes, a price drop matters, huge!