The damaging expense of launching the PS3 will not be repeated when the PS4 arrives later this year.
Sony's chief financial officer Masaru Kato told investors last night that the investment needed to design and produce PS4 was much lighter than the past platform”, according to CVG.
Added Kato: When we launched PS3, initially we had a negative margin on each unit that we sold which was quite big. It did come down over time as we reduced the cost of the console, however the initial investment was quite big due to the fact that we had to design the Cell chipset from scratch which cost a lot of money – hundreds of millions of dollars.
"In addition to that, we had to invest money developing the silicon conductor fabrication technology, as well as the capital expenditures for producing the chipset. All of these amounted to billions of dollars of investment for the platform which had to be recouped as we sold software and hardware.
"Compared to that business model, PS4 utilises a core chipset. Yes, we have designed it with our own technology, but the core of the CPU is something that's available ready, so we're not designing the chipset from the ground up.”
Kato added that Sony has outsourced its manufacturing for the console, drastically reducing the upfront costs.