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Analyst: Vita Risks “Major Failure” Without Price Cut

Sony doesn't feel like reacting to Nintendo's 3DS price cut, but one analyst believes the Vita must fall in price or risk "major failure."

When Sony revealed that their new portable wouldn't be available in the US this year, Kaz Hirai told reporters that Nintendo's price slashing plans won't affect the Vita. He seemed convinced that the price is reasonable and affordable, especially considering what the Vita offers:

"We packed so much into the device and made it very affordable. There is no need to lower the price just because somebody else that happens to be in the video game business decided that they were going to lower their price."

But in speaking to Bloomberg , Ace Securities analyst Hideki Yasuda said consumers are actually expecting Sony to drop the price of the Vita.

"Gamers are increasingly anticipating Sony to lower prices, especially after the 3DS cut. Sony is under major pressure to cut the price of the Vita or risk a major failure."

There will be two versions of the PlayStation Vita; the 3G-enabled one will cost $299 while the one without 3G will hold a $249 price tag. This month, you'll be able to get the 3DS for as low as $169, although higher models do approach the Vita cost. But are both units catering to the same audience? Should Sony be worried about this price differential?

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Jawknee
Jawknee
13 years ago

Yes…Seriously. It's fine if you don't have a use for it but many others will. $250 is a great price for what this piece of hardware is capable of. The original PSP launched at the same price with less than half the features.

A2K78
A2K78
13 years ago

"Should Sony be worried about this price differential?"

Yes they should worried and why? To simpily put Nintendo is essentially using their leverage to draw Sony into a price war. To make matters worst the 3DS have been very profitable for Nintendo from the get-go and this in turn is going to put internal pressure on Sony to make the Vita a profitable product in a very short peroid of time.

"Vita the one that pressured Nintendo to make the cut"

Why should Nintendo be pressured to cut when their product essentially turned a profit from day 1? If anything is more of Nintendo putting pressure on Sony and we saw that by the fact Sony declaring they are selling the Vita at a loss. To make thing worst as I have already mentioned, Sony would be forced into a price war if they want keep pace with the 3DS.

Oxvial
Oxvial
13 years ago

LOL good troll attempt.

FM23
FM23
13 years ago

Funny when you speak the truth, they flag you for trolling. haha, I agree with everything you just said if the quotes are accurate. Sony is actually losing money with this device?…that sucks

Oxvial
Oxvial
13 years ago

''Sony is actually losing money with this device?''.

That's common knowledge, seriously you didn't know?

''that sucks''

No, that's awesome, they give us more for our money.

FM23
FM23
13 years ago

Well from a business stance…losing money SUCKS…but yes, for the consumer….you are getting value unless Sony PR is trying to say Vita is worth more than its asking price.

FM23
FM23
13 years ago

And sorry, I don't follow Vita…so that common knowledge is lost upon me professor.

Oyashiro
Oyashiro
13 years ago

Sony has launched all its consoles at a loss, they make it up with software sales and accessories.

Oxvial
Oxvial
13 years ago

Like Oyashiro already said, this isn't surprising.

FM23
FM23
13 years ago

I knew the PS3 started making profit, but thats the same time I learned Sony was losing money prior to turning profit. Either Sony is full of some business geniuses or they are digging a grave. Either way…I should have known better about the losing money thing…haha

Again gentlemen, I don't follow this financial gain/loss thing, so of course this information surprises me. Not everyone is informed about everything in the gaming world….remember. Just because your knowledgable of something doesn't mean the next man is also.

Bugzbunny109
Bugzbunny109
13 years ago

A2k47, I completely disagree with your last statement. Nintendo WAS making a profit on the 3DS. Apparently, it was no where near enough considering that they had to drop the price by $80; and their bosses had to take 20%-50% pay cuts; so I really don't see what you are contending. I am sure that the Vita also had an influence in the 3DS' price cut. In all logic, if your system wasn't selling well 4-5 months into its lifespan and your competitor was introducing a system technologically better than your system for the same price with big titles, would you not do something?


Last edited by Bugzbunny109 on 8/9/2011 12:23:58 AM

MyWorstNightmar
MyWorstNightmar
13 years ago

Bugs, what are you talking about. You are implying that AK said Nintendo at some point didn't make a profit on the 3DS. Where did AK say Nintendo wasn't making a profit on 3DS? Did you not read his comment properly?

Jawknee
Jawknee
13 years ago

FM if you don't follow these topics and admit to having no knowledge regarding the said topic than just keep your mouth shut and cool it with the snark. They know what they are talking about, you do not so sit back and listen. Maybe you'll learn something.


Last edited by Jawknee on 8/9/2011 2:53:35 PM

danhese
danhese
13 years ago

@A2K78
No company starts making a profit until at least 6 to 12 months into the launch of the device. You have to at least sell enough to cover your investment cost, parts and manufacturing cost, advertisement, packaging and shipping etc. Nintendo have cut the price just 6 months into the launch after they said they wont be cutting the price both by Iwata and Reggie.

As Bugzbunny109 said "it was no where near enough considering that they had to drop the price by $80; and their bosses had to take 20%-50% pay cuts". Not only that, they lost half a billion dollars following the price cut and according to Iwata, 3DS is selling at a loss (http://www.andriasang.com/e/blog/2011/07/29/3ds_losses/)

niedao
niedao
13 years ago

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Oyashiro
Oyashiro
13 years ago

The 3DS is selling horribly for two reasons.

1. There are no games for it. Ninty is mostly to blame for there archaic and well documented practices with 3rd party developers. When a port of a N64 game is your big system seller, that should be all the flags you need to notice something is wrong.

Many companies are canceling their 3DS games, and going as far as saying that they are unsure if it is profitable to develop for the system.

2. The hardware was ridiculously overpriced. Nintendo will never sell anything at a loss, but they feel its perfectly fine to sell a product at a high cost. Its reported that it takes about $106 to make a 3DS but decide to sell at $259. Its the exact opposite of Sony and Microsoft that are willing to sell at a loss.

All this amounts to the poor sales of the 3SD, thats why they slashed the price.

Nintendo CEOs have taken pay cuts in apologies to the share holders.

Sony doesn't look like it will have a anemic software lineup at launch. And its price is a fair one for the amount of tech that's packed in.

In other words no. The Vita does not need a price cut.

Oxvial
Oxvial
13 years ago

I actually read and see people that complain about..the 3D on the 3DS and they prefer to turn off the 3D when they play @.@.

That's a huge problem imo.

___________
___________
13 years ago

you forgot 3 its making allot of people sick, and 4 its got really poor build quality.
my local EB store alone has had 12 returned so far with black screen errors.

___________
___________
13 years ago

in the states i think its a good price as long as it does not suffer the usual sonyites, AKA no games.
if it has a solid launch lineup then that price point should be fine.
though here it SERIOUSLY needs a price drop!
why were paying 400 bucks for the WIFI and 450 for the 3G version is beyond me!
hell 50 bucks more and i could get a 320GB ps3 WITH 4 games AND a extra controller AND a HDMI cable AND a bluray remote!
cant tell me the vita with 3G is worth only 50 bucks less then that!

5TAY3R
5TAY3R
13 years ago

lets be honest, shall we? if nintendo 3ds is
Body Glove then vita is victorias secrets, soo, there is no way u can compare these 2 devices

Jawknee
Jawknee
13 years ago

I don't think they should be compared at all. The DSi is a vastly different system for a different audience, the same goes for the 3DS vs the Vita.

TheHighlander
TheHighlander
13 years ago

The only pressure Sony is under regarding the price of the Vita is coming from Analysts with too many fingers in the Nintendo cookie jar, or analysts who need/want their name to generate hits on google.

OptimusX
OptimusX
13 years ago

There is absolutely no reason to drop the price on the PSV. Just because a handheld that Nintendo launched failed, doesn't mean Sony needs to make a knee jerk reaction. The thing isn't even out yet!!


Last edited by OptimusX on 8/9/2011 12:50:46 PM

Jonesy555
Jonesy555
13 years ago

Sony can gladly have my $249.99; no price cut needed here.

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actrambley21
actrambley21
13 years ago

Nintendo cut the price of the 3DS because it was WAY too expensive to start with. I honestly think that the Vita is at a great price point, but because I am a consumer, cheaper would always make it more tantalizing. These analysts that try to tell companies they need to drop price on a console that hasn't even been released yet obviously assume that Sony doesn't do their own market analytics. THEY KNOW WHAT THEY'RE DOING!

Lol.

Ather
Ather
13 years ago

If Sony says the price is right for all the Vita offers, and consumers are all but demanding a price drop, then Sony has overvalued the Vita. That's not good. if the consumer doesn't like the price, and doens't see the item as having that kind of value, they don't buy. No matter how much Sony says it's more than fair for what Vita provides, if the consumer doesn't see it, it doesn't sell.

Unless these price droppers haven't looked at the specs, Sony has over vauled the Vita. One main thing to look for is, will the people use all the Vita offers? It's nice that Sony made such a wodnerful system, but if nobody wants what the Vita offers, it's autmoaticaly overpriced for what they will do with it.

If the Vita fails, it'll make Sony question the market, and stop proper innovation on future systems. Instead, Sony needs to relook at what consumers want, and what they offer them.

It doesn't matter what the value for price ratio is in Sony's eyes, it's what the people see it as. Sony might have over vauled their system by adding to it what people don't want. It'll be intresting to see how intial sales do. Is any right? Or are the price droppers? As much as people don't want to hear it, the 3DS sales willd etermine these things. If 3DS does much better, Sony will have to rethink the price drop. If not, Sony might simply have made a system most people don't want. No amount of "great value" offered will fix that.