Sony CEO Howard Stringer was recently asked if the PlayStation 3 was suffering as a result of the Nintendo Wii's very strong sales but he said it was not despite the fact that Nintendo probably has the "superior business model".
"The Wii is a well-made device that has found a new target group. For a while, we held the same target group with the SingStar karaoke game. But perhaps we neglected to pursue that avenue," Stringer said. "PlayStation games are rather designed for those who play a lot. Although it's a different strategy, it pays off. We currently have a production bottleneck with the PlayStation 3."
"You also know, however, that our business model is not perfect, and that we make a loss on every console we sell," he confessed. "Nintendo makes money with the hardware alone, which may be a superior business model. But the Wii is not succeeding at our expense - it is not hurting us."
Stringer continued, "We are already making more money with the games than we are losing with the hardware."
In a funny confession, Stringer also admitted that it would take the company a very long time to recover the estimated $3 billion USD that it spent bringing the PS3 to the market.
"It will certainly take some time... We are currently at the stage in which we need to get a grip on the production costs. That takes time."
"You also know, however, that our business model is not perfect, and that we make a loss on every console we sell," he confessed. "Nintendo makes money with the hardware alone, which may be a superior business model. But the Wii is not succeeding at our expense - it is not hurting us."
Stringer continued, "We are already making more money with the games than we are losing with the hardware."
In a funny confession, Stringer also admitted that it would take the company a very long time to recover the estimated $3 billion USD that it spent bringing the PS3 to the market.
"It will certainly take some time... We are currently at the stage in which we need to get a grip on the production costs. That takes time."
