Why the Vita WILL NOT be getting a price cut anytime soon

I've seen quite a few people sayiing that they believe the Vita will be getting a price cut later this year, citing the 3DS situation as proof. Well if you are one of those people you should stop holding your breath. Sony WILL NOT be cutting the price of the Vita anytime soon.

Now keep in mind that Sony hasnt made any official announcements about a price cut either for or against,, but just looking at the situation theyre in is enough to see that one isnt happening. Here is why.

At the current price the PSVITA is already being sold at a loss. Sony absolutley cannot afford to cut it down even further and take an even bigger loss. This is what seperates the 3DS situation from the Vita. The 3DS when it was priced at 250$ was being sold for a substantial profit, so much so that Nintendo was able to cut the price down to 180 and they are still making a small profit from the sales.

Sony is going to have to do something about the crap Vita sales but that thing isnt a price cut. What I do expect to see however is a new market campaign, new bundles, the core model coming with a free game or something, and for Sony to start rushing killer IPs to market. The closest we may see to a price cut is Sony slightly cutting the price of the 3G model, but even then we arent going to see a Vita under $250.

An additional loss of 50$ a unit isnt small, especially when theyre already selling at a loss.Even a drop of 50$ will kill them financially. When Sony mentioned that they were going to be selling the Vita at a loss they also said that they were selling it at such a loss that if they Vita sells as they expected they would turn a profit in 3years. Now that the Vita is underperforming it will probably take them even longer to make a profit.

You also have to consider that a price cut is very risky. While the system will more than likely sell better there is no guarntee that it will sell well enough to either justify the price cut, or that sales will keep up after the inital boom. And a price cut is very permanent. If the system is still underpreforming after the price cut they will just continue to lose more and more money. Its a risk I dont think Sony is willing to take yet

Have any games come out for the thing in the last month, other than MLB 12? Getting tired of seeing only the launch games everywhere I go.

What they really need to do is get some games on the thing, than it will sell.

I've seen quite a few people sayiing that they believe the Vita will be getting a price cut later this year, citing the 3DS situation as proof. Well if you are one of those people you should stop holding your breath. Sony WILL NOT be cutting the price of the Vita anytime soon.

Now keep in mind that Sony hasnt made any official announcements about a price cut either for or against,, but just looking at the situation theyre in is enough to see that one isnt happening. Here is why.

At the current price the PSVITA is already being sold at a loss. Sony absolutley cannot afford to cut it down even further and take an even bigger loss. This is what seperates the 3DS situation from the Vita. The 3DS when it was priced at 250$ was being sold for a substantial profit, so much so that Nintendo was able to cut the price down to 180 and they are still making a small profit from the sales.

Sony is going to have to do something about the crap Vita sales but that thing isnt a price cut. What I do expect to see however is a new market campaign, new bundles, the core model coming with a free game or something, and for Sony to start rushing killer IPs to market. The closest we may see to a price cut is Sony slightly cutting the price of the 3G model, but even then we arent going to see a Vita under $250.

Noj_Leakim

I've seen quite a few people sayiing that they believe the Vita will be getting a price cut later this year, citing the 3DS situation as proof. Well if you are one of those people you should stop holding your breath. Sony WILL NOT be cutting the price of the Vita anytime soon.

Now keep in mind that Sony hasnt made any official announcements about a price cut either for or against,, but just looking at the situation theyre in is enough to see that one isnt happening. Here is why.

At the current price the PSVITA is already being sold at a loss. Sony absolutley cannot afford to cut it down even further and take an even bigger loss. This is what seperates the 3DS situation from the Vita. The 3DS when it was priced at 250$ was being sold for a substantial profit, so much so that Nintendo was able to cut the price down to 180 and they are still making a small profit from the sales.

Sony is going to have to do something about the crap Vita sales but that thing isnt a price cut. What I do expect to see however is a new market campaign, new bundles, the core model coming with a free game or something, and for Sony to start rushing killer IPs to market. The closest we may see to a price cut is Sony slightly cutting the price of the 3G model, but even then we arent going to see a Vita under $250.

Noj_Leakim

Production costs only $160 per unit. Add in marketing and RnD and im guyessing their pocketting a small profit. http://www.destructoid.com/ps-vita-3g-teardown-puts-sony-s-cost-at-159-220036.phtmlRawca

That is just an estimate made from how much the components of the Vita cost seperatly. It DOES NOT take into account R&D, manufacturing, marketing, shipping, ect.

Kaz Hirai himself said that the Vita would be sold at a large loss.http://www.examiner.com/video-game-in-national/sony-to-sell-playstation-vita-for-a-loss-profitable-3yrs

In fact an analyst stated that the PSVITA would be sold at a $60 loss per unit.

@famicommander Yes the Vita situation is dire, and I am SO sorry that I accidentally hit the 7 key instead of the 8, but Im NOT talking out of my ass. If being sold at a $60 loss makes it so they would only be profitable in 3 years selling at a $110 dollar loss per unit sold would make it so they wouldnt be profitable for 5-6 YEARS, the entire lifespan of a console. Why would Sony cut the price to increase sales only to lose even more money and not see profit over the consoles entire lifespan? Sony isnt that desperate yet. There are still plenty of methods they can try to increase sales. Such a drastric price cut should be an absolute LAST resort.

Also there is no proof that the 3DS is selling at a loss. Unlike the Vita where Kaz Hirai straight up went and said so. The 3DS still could be selling at a small profit, there is no official statement one way or the other. but given how one of Nintendos policys has always been not to sell at a loss it is easy to assume that Nintendo wouldnt have cut the price down to that point.

Okay I was wrong about the 3DS being sold at a loss. Oh well. But that actually helps my other point. Nintendo says that the 3DS will be profitable by April 2012. Thats RIGHT NOW. The 3DS was sold at a loss for around 8 months and is NOW profitable. At its current price the Vita wont be profitable for 3 or 4 years. As I said earlier if they cut the price even further the system wont be profitable for 6 or 7 years. That would mean that the Vita would go its entire lifespan without being profitable. That is financial suicide.

I DO understand the direness of the Vitas situation, but Im looking at a bigger picture then you seem to be looking at. Your view seems to stop at increasing sales. Im looking at the future profitability of the system. The Vitas sales WOULD more than likely increase with a price cut, but the losses on each system sold would ensure that they never make a profit off the Vita, even with the increased sales. That situation is FAR more dire for Sony than the current situation of the Vita. It isnt selling right now but it still has the potential to make money eventually. There WILL NOT be a price cut anytime soon for this very reason.

Okay I was wrong about the 3DS being sold at a loss. Oh well. But that actually helps my other point. Nintendo says that the 3DS will be profitable by April 2012. Thats RIGHT NOW. The 3DS was sold at a loss for around 8 months and is NOW profitable. At its current price the Vita wont be profitable for 3 or 4 years. As I said earlier if they cut the price even further the system wont be profitable for 6 or 7 years. That would mean that the Vita would go its entire lifespan without being profitable. That is financial suicide.

I DO understand the direness of the Vitas situation, but Im looking at a bigger picture then you seem to be looking at. Your view seems to stop at increasing sales. Im looking at the future profitability of the system. The Vitas sales WOULD more than likely increase with a price cut, but the losses on each system sold would ensure that they never make a profit off the Vita, even with the increased sales. That situation is FAR more dire for Sony than the current situation of the Vita. It isnt selling right now but it still has the potential to make money eventually. There WILL NOT be a price cut anytime soon for this very reason.

Noj_Leakim

Okay I was wrong about the 3DS being sold at a loss. Oh well. But that actually helps my other point. Nintendo says that the 3DS will be profitable by April 2012. Thats RIGHT NOW. The 3DS was sold at a loss for around 8 months and is NOW profitable. At its current price the Vita wont be profitable for 3 or 4 years. As I said earlier if they cut the price even further the system wont be profitable for 6 or 7 years. That would mean that the Vita would go its entire lifespan without being profitable. That is financial suicide.

I DO understand the direness of the Vitas situation, but Im looking at a bigger picture then you seem to be looking at. Your view seems to stop at increasing sales. Im looking at the future profitability of the system. The Vitas sales WOULD more than likely increase with a price cut, but the losses on each system sold would ensure that they never make a profit off the Vita, even with the increased sales. That situation is FAR more dire for Sony than the current situation of the Vita. It isnt selling right now but it still has the potential to make money eventually. There WILL NOT be a price cut anytime soon for this very reason.

Noj_Leakim

[QUOTE="Noj_Leakim"]

Okay I was wrong about the 3DS being sold at a loss. Oh well. But that actually helps my other point. Nintendo says that the 3DS will be profitable by April 2012. Thats RIGHT NOW. The 3DS was sold at a loss for around 8 months and is NOW profitable. At its current price the Vita wont be profitable for 3 or 4 years. As I said earlier if they cut the price even further the system wont be profitable for 6 or 7 years. That would mean that the Vita would go its entire lifespan without being profitable. That is financial suicide.

I DO understand the direness of the Vitas situation, but Im looking at a bigger picture then you seem to be looking at. Your view seems to stop at increasing sales. Im looking at the future profitability of the system. The Vitas sales WOULD more than likely increase with a price cut, but the losses on each system sold would ensure that they never make a profit off the Vita, even with the increased sales. That situation is FAR more dire for Sony than the current situation of the Vita. It isnt selling right now but it still has the potential to make money eventually. There WILL NOT be a price cut anytime soon for this very reason.

famicommander

This. Sony has to do something and soon if system sellers in both here and Japan are not moving units as they predicted. If Sony just waits, Vita will be dead within a year. If you look at things pre-price cut for the 3DS, as others have said, things are already in worse situation for the Vita during the same time frame and that is saying something. All the hardware muscle for a portable or any system doesnt mean jack if there arent games to back it up. Sony is really in a bind.

Either they drop the price of the system, drop the price of the memory cards, produce a new portable hardware with built-in storage (as they should have done from day one), or do a really big bundle to try to entice people. Because as of right now Vita is already heading for the drain.

They would be in a much better place if they had decided to take a loss on the memory cards, rather than the system itself.Granpire

I ain't buyin it. it is too expensive and no games are there that i want. if it is getting cheaper and there are games on it then it is a good buy.

simple as that.

Have any games come out for the thing in the last month, other than MLB 12? Getting tired of seeing only the launch games everywhere I go.

ItsEvolution

I ain't buyin it. it is too expensive and no games are there that i want. if it is getting cheaper and there are games on it then it is a good buy.

simple as that.

foxfacer2d2

I think the situation with the 3DS price cut was a whole other monster. People shouldn't assume the Vita will have one because the 3DS did, anyway.

I honestly think that the handheld makers have shot themselves in the foot by constantly offering new versions and price cuts because every article I have seen about them one of the big comments for both is "wait for a price cut or a new model".

This is the handheld that most gamers have dreamt about for 10 years and when the price was announced everybody thought it was a great deal.

[QUOTE="Noj_Leakim"]

Okay I was wrong about the 3DS being sold at a loss. Oh well. But that actually helps my other point. Nintendo says that the 3DS will be profitable by April 2012. Thats RIGHT NOW. The 3DS was sold at a loss for around 8 months and is NOW profitable. At its current price the Vita wont be profitable for 3 or 4 years. As I said earlier if they cut the price even further the system wont be profitable for 6 or 7 years. That would mean that the Vita would go its entire lifespan without being profitable. That is financial suicide.

I DO understand the direness of the Vitas situation, but Im looking at a bigger picture then you seem to be looking at. Your view seems to stop at increasing sales. Im looking at the future profitability of the system. The Vitas sales WOULD more than likely increase with a price cut, but the losses on each system sold would ensure that they never make a profit off the Vita, even with the increased sales. That situation is FAR more dire for Sony than the current situation of the Vita. It isnt selling right now but it still has the potential to make money eventually. There WILL NOT be a price cut anytime soon for this very reason.

famicommander

Now youre just making **** up about the 3DS situation. In the article YOU linked me it reads exactly this "Nintendo president Satoru Iwata has said Nintendo expects to make a profit from 3DS hardware sales in the first half of its next fiscal year, which kicks off on April 1, 2012."It doesnt say anywhere that they will be making profit by the END of the fiscal year, it says in the first 1/2, with no specific date mentioned. They may not be making profit this second, but they very well could be since it is in fact now in the period of time mentioned, THE FIRST HALF OF THE FISCAL YEAR. Your prediction of profitablity by October or November in fact puts it directly in the second 1/2 of the fiscal year meaning that youre estimate is more than likely wrong. In fact my guess of them making profit now is more likely.

Now I DO UNDERSTAND THE SITUATION! Stop saying that even when Ive proven my knowledge of it several times. I knew about everything you mentioned including the 3DS outselling it 10:1 and about Monster Hunter ect.. At this point youre doing exactly what I said people shouldnt do in the first place and directly comparing it to the 3DS situation as I said when I told people to stop assuming the inevitability of the price cut based on the 3DS'.

I NEVER once said that Sony should take a wait and see approach. In fact I said in multiple posts that Sony would be trying different things to boost the Vitas sales including revamped marketing, releasing killer IPs and releasing a new bundle. Once again you arent looking at the bigger picture beyond selling more units fast to increase the install base. If the Vita is losing 110$ on each unit sold IT DOESNT MATTER how many games they sell from the increased install base, they will never dig themselves out of the money pit the Vita wouldve become. Need I remind you that it would take them at minimum 6 years for the Vita to finally become profitable with them losing so much money on each console sold. Whatever money they do recieve from the increased game sales will just immediatly go into the money pit the Vita wouldve created at this point.

As I have said MULTIPLE times by this point, new games will be announced for the Vita to encourage sales, there will be a new marketing push, and Sony will likely put out a new bundle as an incentive to buy the Vita, but THE VITA WILL NOT GET A PRICE CUT ANYTIME SOON

You just won't stop digging yourself deeper, will you? First off, this statement: "Nintendo president Satoru Iwata has said Nintendo expects to make a profit from 3DS hardware sales in the first half of its next fiscal year, which kicks off on April 1, 2012." It says quite clearly that the financial year KICKS OFF April 1. That means the next year begins NEXT April. Follow me? April is the fourth month of the year. Half a year is six months. Still with me? Alright, good. So what's four plus six? Ten, right. And which month is the tenth month? October? You don't say? Where is Sony going to get these killer IPs you keep talking about? The two biggest they own are Hot Shots and Uncharted and both have already failed. So obviously these killer IPs have got to come from third parties, and right now no third party in their right mind would make an exclusive mainline title for Vita. Everything you're saying is based on assumptions and wishful thinking. If they don't fix the sales NOW it's beyond stupid to worry about six years down the line. They have to save the platform or there won't be anything TO worry about in six years. I know you really want the Vita to succeed, but just saying things doesn't make them true. There's no way Vita gets to its one year anniversary at the same price it is now. Period.famicommander

God youre an idiot. Yes I know that the fiscal term starts April 1st, I even mentioned it. Exactly sixth months from April 1st is exactly October 1st. Now you said that it will be profitable in October, or November. THe SECOND 1/2 of the fiscal term six months later would therefore START on OCTOBER 1st! Stop acting like a condensending JERK when you are actually the one thats wrong.

The other thing that you are obviously ignorant about is how a buisness works. You CANT just look at the immediate future, you HAVE to look at the bigger picture, or else youll go under in no time. ONCE AGAIN selling a bunch of units really fast isnt a good thing for Sony, since they will lose money in the long run. As Ive said multiple times, a price cut isnt the only way to save a console.

As for those new games, of course they havent been announced yet. Sony is waiting for the perfect time to announce them E3, where they will have maximum press coverage and hype. Announcing a game for the Vita now would be pointless since the information will only reach a certain audience. Waiting for e3 means a MUCH larger audience will be paying attention. As for what games they could announce. God of War, Metal Gear Solid, details on the CALL OF DUTY game that was announced awhile back, Final Fantasy, Twisted Metal, a Monster Hunter game, heck maybe even Grand Theft Auto. ALL of these are system sellers, I dont know why you think that Hot Shots Golf, and Uncharted are the only things Sony can have up its sleeves.

If being sold at a $60 loss makes it so they would only be profitable in 3 years selling at a $110 dollar loss per unit sold would make it so they wouldnt be profitable for 5-6 YEARS, the entire lifespan of a console.Noj_Leakim

The parts used to manufacture a Vita are going to be more or less the same as it is now, 5 or 6 years down the line. If it costs them $300 to produce a single Vita now, its definitely not going to cost them the same next year. If they lowered the price during the fourth quarter of this year for example, they might be breaking even when you take into account how much the cost of those parts have lowered by then. When I say breaking even, I'm talking about being able to drop the price by X amount while still maintaining the same $60 loss they are now, during the fourth quarter of this year.

That is part of why I think a price drop is very possible by the end of this year. I'll still be picking mine up regardless of a price drop or not once Gravity Rush comes out though!

@famicommander

Look I agree this is getting tiring but I do have valid points, and it seems you do as well. Heres the thing. I already admitted that I was misinformed about Nintendo already pulling a small profit after the price cut. That was my mistake. You said October/November and I said that they could already be making a profit since they are now in the range announced. Realistically we are probably both wrong and they will begin to profit sometime this summer, in the middle of our proposed dates.

Now about the Vita and its games. The Japanese Vita conference and whatever media coverage they recieved is NOTHING compared to E3. Wasting a bunch of reveals at something like that would be a wasted oppurtunity and more than likely they dont have much ready to announce, or much to show at this point. To put it simply Sony really was unprepared for the Vita launch in terms of game development (probably because they wanted to relase the Vita sooner to not fall too far behind the 3DS). The games theyre developing either arent ready to be shown, or they are waiting for E3 like I said earlier. About the specific games I mentioned, were just a bunch of AAA franchises Sony COULD release for the Vita. My whole point was that there is plenty left that Sony could release, in response to you saying they were screwed after the mixed reception to Uncharted and Hot Shots. Even so Ill respond to your criticisms about each series I named.

God of War- glad you agree, but dont underestimate God of War as a system seller

Final Fantasy-X as you mentioned is coming out, and the fact that its a multiplat is a shame. However it that doesnt mean that they couldnt announce another

Call of Duty- the definition of a system seller (unfortunately). While they havent recieved much love on the portables, dont forget that a Call of Duty portable game hasnt been released or hyped since before the series hit it big with MW (other than the DS releases but the DS isnt exactly the call of duty audience.) The BIGGEST change that could affect the Vitas sales is this new brand awareness. If marketed properly it could very well reach the COD audience and get them to buy the system. There is also no proof that this will be a port, and could be an entirely "original" game, especially since it is being developed by a different team and probably has been in development longer than the next console COD. Plus the dual analog sticks allow it to be played properly for the first time on a handheld. This is probably the biggest game changer in terms of the future of the VIta

Metal Gear Solid- 4 ORIGINAL games were developed for the PsP, making it not to hard to imagine that Sony and Konami are cooking something up for its succesor.

Grand Theft Auto- Nobody said it had to be an exclusive. A "stories" version of GTA4 would be eaten up by fans.

Twisted Metal- agree with you here, its not exactly a system seller but it IS a franchise worth mentioning

My whole point with ALL this has always been that there are plenty of other options Sony has to consider before commiting financial suicide by dropping its price. Youve never exactly come up with a solution to the whole digging themselves into a whole by selling the Vita at a $110 dollar loss, other than saying that they have no other choice, which as Ive said all along they have plenty. The price drop is the LAST option Sony should be considering.

Thats the difference between you and I. You already believe they should be jumping ship, while I think they have plenty of options left to fix their situation before going down with it. I will say though that If they do everything Ive predicted (game announcements,marketing,bundles) and its sales havent improved by the end of the year. A price drop WILL happen. Probably mid next year,.

@daiyume

I had considered how tech becomes cheaper when I made my original argument. I still stick with the 6 years thing. When Sony made 3 years until profitability announcement that assume they wouldve accounteed for that factor. That was made under the assumption that the Vita would be selling moderatly well. Given the crap sales of the Vita so far that profitability analysis is probably 4 years or more to become profitable at the current $60 loss. If I hadnt accounted for the lower cost of tech I wouldve said that they would be profitable in 7-8 years at the $110 dollar loss.

Boring argument is boring. The Vita needs compelling games, not a price cut.

Boring argument is boring. The Vita needs compelling games, not a price cut.

ItsEvolution

[QUOTE="ItsEvolution"]

Boring argument is boring. The Vita needs compelling games, not a price cut.

CrazyUkrainian

So what? I think that'd also be true of people who got a 3DS. If the Vita only wants to appeal to people old enough to have a job, it will fail.

Boring argument is boring. The Vita needs compelling games, not a price cut.

ItsEvolution

I just don't get Sony.

Why would they sell a handheld console which is so expensive and it doesn't even make a profit?

moreover, it didn't even sold well even now. Could it be that Sony is filthy rich to make losses like these?

I just don't get this marketing stuff mumbo jumbo that is why there was a degree in college for it to fully understand.

[QUOTE="CrazyUkrainian"][QUOTE="ItsEvolution"]

Boring argument is boring. The Vita needs compelling games, not a price cut.

Audacitron

So what? I think that'd also be true of people who got a 3DS. If the Vita only wants to appeal to people old enough to have a job, it will fail.

[QUOTE="Audacitron"]

[QUOTE="CrazyUkrainian"] Agreed. I have a strange feeling that most people who say that Vita needs a price cut are not even old enough to get a job. CrazyUkrainian

So what? I think that'd also be true of people who got a 3DS. If the Vita only wants to appeal to people old enough to have a job, it will fail.

price cuts will always be good no matter what for the consumers hoping to plan on buying a vita.

Sony could at least start including a PSvita memory card with every PSvita. A Price cut will not happen for at least 2 years.

I just hope that when sony sells the ps vita at a loss, they won't be laying off workers since we all know that none of it making since selling it at a loss.

they should have made the ps vita price like 350$ and then have a price cut to 250$ maybe that would confuse some that there was a price cut.

The bottom line is the Vita is failing, hard. Something needs to be done about it and Sony may have their hands tied soon if not already. I wouldn't hold my breath.

Sounds trivial, but I think lowering the price of the memory cards would make a substantial difference. This surely is the smartest thing for Sony to do as the production costs for those cards has to be a fraction of what they're charging. Seriously if they brought the 4gb cards down from $20 to under $10 (Closer to the price of the standard non-proprietary card) I, and I'm sure many other potential customers would feel more inclinded to buy a vita.

I've seen quite a few people sayiing that they believe the Vita will be getting a price cut later this year, citing the 3DS situation as proof. Well if you are one of those people you should stop holding your breath. Sony WILL NOT be cutting the price of the Vita anytime soon.

Now keep in mind that Sony hasnt made any official announcements about a price cut either for or against,, but just looking at the situation theyre in is enough to see that one isnt happening. Here is why.

At the current price the PSVITA is already being sold at a loss. Sony absolutley cannot afford to cut it down even further and take an even bigger loss. This is what seperates the 3DS situation from the Vita. The 3DS when it was priced at 250$ was being sold for a substantial profit, so much so that Nintendo was able to cut the price down to 180 and they are still making a small profit from the sales.

Sony is going to have to do something about the crap Vita sales but that thing isnt a price cut. What I do expect to see however is a new market campaign, new bundles, the core model coming with a free game or something, and for Sony to start rushing killer IPs to market. The closest we may see to a price cut is Sony slightly cutting the price of the 3G model, but even then we arent going to see a Vita under $250.

Noj_Leakim

[QUOTE="Audacitron"]

[QUOTE="CrazyUkrainian"] Agreed. I have a strange feeling that most people who say that Vita needs a price cut are not even old enough to get a job. CrazyUkrainian

So what? I think that'd also be true of people who got a 3DS. If the Vita only wants to appeal to people old enough to have a job, it will fail.

Well I'm sure their parents wish it was more expensive. Not.

Even when kids aren't spending their own money, they still have to convince their parents. Maybe your parents have unlimited funds, or caved in to your every whim but most do not.