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How to Make the PS3 look Cheap

BusinessWeek reports that Hirokazu Hamamura of Enterbrain says that developers are shying away from the PS3 because of the PS3’s high price. They note that on July 13th, EA mentioned more Wii games than PS3 games. Recently in an interview Jeff Brown said that EA will no back all next-gen consoles equally. He said, basically, that they go where the marketshare is. If the Xbox 360 has a much higher marketshare, then that’s where EA will have more games. That makes sense. EA’s supposed better support for the Wii is a little confusing to me, however. First, looks can be deceiving. EA may be just as much behind the PS3 as the Wii, and we might be none the wiser. But let’s say they are in fact backing the Wii more. Is it really because they see the PS3 as the super-expensive console that won’t sell?

BusinessWeek’s made the mistake of saying the PS3 is $200 more expensive than the Xbox 360. It’s not. It’s $100 more. Yes, that’s comparing the more expensive Xbox 360 with the PS3 Jr. But it’s not fair to compare the 360 with the PS3 Sr because the PS3 Jr is the one that’s actually closer in functionality.

So what you’re really talking about is a $100 difference. And in some markets, like Canada, the difference is even less (here, if the Xbox 360 price remains the same, the difference will be $50.)

Joe Sixpack really seems to get around, and he’s making an appearance here again. Joe goes to the store to buy his son Billy a console. “Hey Billy boy! What’s that gaming machine you got?” “It’s a PS2 dad!” With 70% marketshare, chances are it’s a PS2. Mr. Clerk at the store tells Joe that he can choose between the 360, PS3, or maybe the Wii. Mr. Clerk’s commission on the Wii isn’t so big, so he’ll flog the big consoles first. Joe will probably ask about the PS3 because his boy already has a PS2. But whoa, would you look at that price! $600! Mr. Clerk points out that the PS3 Jr. is $500 – only $100 bucks more than the 360, which it’s very comparable to, and it will play all of Billy’s PS2 games. Plus it has a built-in BD player and has free online games. Joe, of course, has no idea what a BD player is so his mind blanks for a moment while it erases that piece of information from his memory. So the choice comes down to $400 for a 360, or 25% more ($100) for the PS3 which will play all of Billy’s PS2 games, has free online gaming, and is a known brand. Everyone knows the Sony PlayStation! In Canada, it’s just 10% ($50) more. If Joe were Canadian, I think the answer would be obvious: get the PS3. It’s only $50 more. In the States, where it’s $100, I don’t think it’s too much of a stretch to suppose Joe will choose the PS3 there as well. Do you, given those circumstances?

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