[UPDATE] Pachter: Sony is ripping off consumers with PSP Go
- Posted June 12th, 2009 at 11:54 EDT by Mike Harradence
- 9,586 views
- 134 Comments
UPDATE:
Pachter has since issued an apology for what he describes as a 'poor choice of words' regarding his comments over the price point of PSP Go:
"I sincerely regret the choice of words in my response to [GameTrailers TV editor and presenter] Geoff Keighley's question in last week's Bonus Round, where I said that Sony is "ripping off" the consumer by pricing the PSP Go at USD 249.99," he told IndustryGamers.
"I made a poor choice of words, and I do not think that Sony is doing anything nefarious in choosing their pricing strategy.
"The company has the right to price its products at a point that they think is competitive, and has no obligation to sell products at lower than a competitive price,"
ORIGINAL ARTICLE:
Wedbush Morgan Securities analyst Michael Pachter has accused Sony of deliberately ripping off punters by slapping a hefty $249 price tag on its newly announced PSP Go in North America.
"I'm sorry to say it, I don't want to get bad fan mail from the Sony fanboys, but Sony is ripping off the consumer until they sell a couple of million," Pachter told GameTrailers.com.
The analyst observed that the PSP-3000 is more expensive to manufacture than the PSP Go, the latter of which supports only digital-based content as opposed to the 3000’s UMD format.
"Disc assembly for UMD costs more than 16GB of Flash does," he said. "So this new device doesn't cost them as much to make as the PSP-3000 and they've jacked the price up USD 80. And if consumers don't buy it then the price is going to come down. They're making a lot more money on the PSP Go than the PSP-3000."
Pachter went on to outline the growth in digital distribution within the games industry, which is slowly replacing the need for physical media. "PSP Go is a game changer for digital delivery and yet they're still going to support the PSP-3000, they've got to keep the retailers happy,” he said.
"This year's show is 'packaged goods are going away'. Half of all gaming purchases ten years from now are going to be digital. You can see it coming for the first time ever, the console manufacturers are behind it.”
PSP Go is due for release in October 2009.
Comments
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Dave-The-Rave |
Dave-The-Rave- 3:53pm BST - June 11th, 2009
- 2
This guy is absolutely right, everyone else here has their eyes shut tight..
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TheRealCarbonfibre |
Carbonfibre- 3:54pm BST - June 11th, 2009
- 3
I agree with him, if it was 80 bucks cheaper than the 3000 i'd buy two! No not really I lied about the last bit...
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Stoffinator |
Stoffinator- 3:57pm BST - June 11th, 2009
- 5
For once I do agree with him. Sony really is ripping people off with the Go!
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daevv
- 3:58pm BST - June 11th, 2009
- 6
I have two PSP-1000 models now and was maybe gonna get the GO but it priced itself right off mine and many others radar. We'll see how many it sells upon launch. On another note Nintendo and Apple have been fleecing the consumer with minor handheld upgrades for years....It's how they make their money.
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bilbo_bobbins |
bilbo_bobbins- 4:01pm BST - June 11th, 2009
- 7
I think he has a VERY valid point here. I couldn't see the point in buying it. It does the same thing as the 3000.
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hillybilly |
apeh- 4:08pm BST - June 11th, 2009
- 8
even though this is right, isnt this what all buisnesses do? For example PS3 sold extorionally high on release date and fell as demand lowed, same will happen with the go
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bplewis24
- 4:14pm BST - June 11th, 2009
- 12
So the Wii costs less to manufacture than the 360 and sells for more than the base 360, yet it is not a ripoff, but the PSP Go is?
Some MP3 players, iPods and (i)Phones sell for much higher than their manufacturing costs not to mention more than $250. Are they ripoffs too?
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bravo9zero |
Bravo9zero- 4:22pm BST - June 11th, 2009
- 16
I have to agree with Patcher,
Need to sort the price out.
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Fat_Old_Sun
- 4:27pm BST - June 11th, 2009
- 18
bbbbut a 16gb ipod costs the same.
This dude is wrong about everything soooo, grain of salt. $249 is pricey but I dont know how much it costs to make and neither does this guy.
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liquidus118 |
liquidus118- 4:28pm BST - June 11th, 2009
- 19
It's a rip off, I wont pay £230 for the privelage of losing all my games I have bought up til now.
If this was relatively cheap I would have considered getting one, but it isn't, so screw them.
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ElPulga |
xbacillusx- 4:35pm BST - June 11th, 2009
- 23
But that is only based around the UMD well i dont know if the screen, the sliding thingy or being smaller might cause the price to go up. And the other thing, tho it is cheaper they still have to get their money back from any research they made designing Go. Other than that when I go out of my house is because I want to do other things, rather than play video games which i can do in my house or at my friends house, hehehe that is why i sold my psp a while ago XD. I am quite happy with my Ps3 and Pc
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fleinn |
fleinn- 4:37pm BST - June 11th, 2009
- 24
I'm sure he's right about the price, and that a lot of people would like to have it for free. But he's doesn't know very much about engineering, does he.. Or how the industry works either, I guess, even if that's probably a choice he makes. UMD is what the industry wants, since it allows you to sell discs - and that's worth a lot to retailers, and will make it possible to keep the prices of games more uniform. So something without discs will allow for more flexible and cheaper releases, and adjusting the price- point for titles. As well as allow for less expensive titles to be made, since it costs less to publish. And that's just a net loss to the entire industry, compared to /if it sold as well/ on a disc- based format. Something which it of course will not do.
So yeah, here's why Pachter gets as much exposure. He's pushing industry wisdom, playing to the home crowd, and makes fun of consumers who know what they want, as usual. It's what comes natural, of course, when you sincerely believe that as long as the industry as a whole makes as much money as possible, the consumer will be automatically be given a better product.
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coverton341 |
groovy341- 5:00pm BST - June 11th, 2009
- 26
@19 You did hear that they are setting up a place where you can convert your back catalog of games yes?
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porkins
- 5:03pm BST - June 11th, 2009
- 27
I don't buy that one fleinn good points but I am not sold on that idea. The games for the Go will not be priced any less than physical media there is no doubt in my mind they will be priced at 39.99. I may be proven wrong but until then I think the Go is over priced so I actually agree with Patcher here. Less moving parts, less cost on overhead should translate to a cheaper price.
What this does allow for is a pricing strategy that is similar to the iphone for individual developers to make indie games and applications with the reduction of the psp dev kits. If you think that tank wars should be the same as GOW chains of olympus then sorry I bothered typing this out there is no hope. Sony unfortunately priced themselves out of the market with this one and the sales will be nowhere near that of the dsi, its main competitor, when it's launched. The upgrade here is much more signifigant but I doubt it will translate to sales simply because of the pricepoint. I for one am going to wait for the inevitable price drop to upgrade, my 1000 is still working fine. Had they introduced the Go at a more attractive price point it would have been a no brainer day one for me, now they will have to wait for my purchase.
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Triple Dk |
TripleDk- 5:05pm BST - June 11th, 2009
- 28
It's hard to judge this one actually... The PSP Go is in many ways better than the PSP-3000, therefore you would think it's more expensive. But on the other hand it's most likely cheaper to produce, and can then be sold for less still with profit. But I'd have to say it's okay for Sony to charge like this. They shouldn't set a price point based on how much it costs to produce, but instead price it based on how good the product is (and in this case, the GO! is better than the 3000).
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fleinn |
fleinn- 5:23pm BST - June 11th, 2009
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@27: no, I just said it will be possible to charge exorbitant prices for the full releases, and still get in more risky things at a lower price- point without a loss. The problem with it is that retailers of disc- based software is losing out. That's the problem, and I'm delighted that Sony simply forces this to happen, as it will change how the publishing industry works, into something at least marginally sane.
As far as less moving parts == less cost. Doesn't work that way. It costs a lot more to make something smaller. Just on the chassis, it's also the slide, etc. And cramming two arm- processors and the rest of it into something that small probably requires non- standard modules fitted to the actual mainboard, and not added on with extra contacts like it's usually done. So you need to produce that new design, rather than buying cheap components. We'll have to see about that, of course - it could be it's a cheap mash- up that isn't going to last very long. But when it comes out, we'll see.
But you can't say now, that because it's not got UMD, it's not worth a more expensive price than the previous versions. You can say /you don't want to pay/ that much for it, and that Sony is trying to get the highest possible price for it - and you're not buying it. That's entirely up to you. But coming up with the idea that it actually costs less to produce, and therefore the evil japs are being too greedy, that's not based on a technical argument, period.
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zombieking36
- 5:35pm BST - June 11th, 2009
- 34
"Sony Fanboys" If he wants people care what he says, he shouldn't use degradtory terminalogy... That is all media hype that certain people like to toy with, not official business setting vocabulary.
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jaybiv |
jaybiv- 5:36pm BST - June 11th, 2009
- 36
Darn right it is expensive. That doesn't mean it's not worth every penny. Maybe for some of you tight wads, but probably not for the masses. Are BMWs and Mercedes Benzs too expensive? The best iPhone? You bet they are and they are made for people who value the experience over price. If Sony cheaped their way through like MS did with the 360, you'd all be crying about how cheap and unreliable the Go! was. Listen up little kiddies, I'm going to drop some knowledge on you that your parents should have. If you want quality, sometimes (not always) you have to pay for it. Sony has proven over their history that you are getting what you pay for. So if you think the Go! is over priced it says more about you as a consumer, than Sony as a premium electronics brand.
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mikeghtmare |
mikeghtmare- 5:57pm BST - June 11th, 2009
- 37
@2, it's called business; you can still buy the original PSP if you prefer.
@1, you are absolutely right. What about the iPod for instance? and so many other products perticularly in the handheld area are the same. -
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subwaydesign
- 6:04pm BST - June 11th, 2009
- 39
everything is overpriced this days. besides, you can still go buy a 3000. the extra $ are for "exclusiveness", just like a mac or ipod. what kind of computer do you use to write this, Pachter?
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andysw
- 6:09pm BST - June 11th, 2009
- 40
The xbox 360 was even more of a rip off and it's still is when you're including essential periperals. $400 launch price for a dvd player with no wifi, no charge kit, no hard drive, yearly pay service for multiplayer. Here's the best part, periphereals cost more than they should be. $40 for a wireless headset that's low quality, whilst you can get any blutooth wireless headset with great quality for the playstation 3 for $20.
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radgamer420 |
mistercrow- 6:09pm BST - June 11th, 2009
- 41
I totally agree with him. The PSP Go is a major rip off.
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darthrazorback
- 6:26pm BST - June 11th, 2009
- 45
The man is right. It is a ripoff to charge more for a cheaper product.
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joeymetalgear7 |
joeymetalgear777- 6:33pm BST - June 11th, 2009
- 46
in a way I agree with him cus like im not made of money but regardless of manufacturin costs if it gives me value for money then ill gladly pay the high price and the psp go is looking pretty damn good
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TCsGotITdotcom
- 6:38pm BST - June 11th, 2009
- 47
Is Big Business tactics really that much of a shock to anyone over the age of say.... I just found out Santa Clause is not real. This is what happens with early adoption of ANY technology. Sony is a business they NEED to make money not lose it. They gave you darn near everything you could want in the PS3 and they are STILL LOSING money. They are allowed to make money right just like microsoft or nintendo. They dont need 16 different variation of the DS they do it to MAKE MORE MONEY.. money money money that stuff you gotta ask your mommy or wife or sometimes BOTH to buy that new game or console. Pull your big girl panties up an deal with it.
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kicks
- 6:41pm BST - June 11th, 2009
- 48
I half agree
the bluetooth module can't even come close to equalling the cost of the UMD drive. The battery differences could cover some due to a smaller size that yields the same length.I am dissappointed that he didn't talk this much about the GBA slotless DSi that went up $50 from the DS. We'll see though. Had the PSP Go been priced at $200 it would have definitely made it easier to justify for me as an existing 3000 owner.
Maybe the $250 price tag is help throw money at the third party developers in order to make their backlog titles digitally available.....
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wetfbbqchiken
- 6:42pm BST - June 11th, 2009
- 49
lol lucky americans ... just converted the uk price to dollars and it comes out at $353.83 ... what a rip off
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ohshutyourmouth |
ohshutyourmouth- 6:48pm BST - June 11th, 2009
- 50
i agree with this idiot . PSP go will be a flop i must add.
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