Semi-Daily Journal Archive

The Blogspot archive of the weblog of J. Bradford DeLong, Professor of Economics and Chair of the PEIS major at U.C. Berkeley, a Research Associate of the National Bureau of Economic Research, and former Deputy Assistant Secretary of the U.S. Treasury.

Monday, November 20, 2006

SONY Drives for PS3 Market Share at Launch

SONY spends a fortune to launch the PS3:

Paul Kedrosky's Infectious Greed: Tearing Down the PS3: Losing Money on Every Sale, etc.: iSuppli has out its teardown of the PS3, and it contains some fascinating factoids:

  • Sony is losing an astounding $306.85 to $241.35 in manufacturing and component costs per PS3, depending on the configuration
  • Cell processor costs are a rock-bottom $85
  • In the entire history of iSuppli's teardowns it has only seen three semiconductors with 1,200 or more pins; the PS3 alone has three such chips

The size of the loss per unit is, my recollection, the largest in the history of the gaming industry. It is a fairly remarkable demonstration of how the industry has changed, especially when you consider that the PS3 is delivering supercomputer levels of performance.

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