Soft PS3 sales spell trouble for EA, others
Posted Jan 25th 2007 2:35PM by Blake Snow
Filed under: Sony PlayStation 3, Business
Who's on the PS3's side, who? Lots. Historically speaking, brand PlayStation has had the best third-party support over any other platform. That's what happens when your first two consoles sell bajillions. A higher install base means more sales of games and a better chance for game developers to make money. So given such strong support for PlayStation systems in general, it's no surprise that EA and others were/are heavy backers of the PS3 from the start.
But according to Bank of America, soft PS3 sales not only spell trouble for Sony but for the many third-party publishers supporting the platform, namely EA. Based on recent channel checks at 50 stores, 78% had PS3s in stock. Hence, "disappointing PS3 hardware sales are an incremental negative for all the game publishers." So much, in fact, that 2007 publisher stocks could take a substantial dive this year as 21% of their total expected revenues were pinned on the PS3.
As you can imagine, continued blame for the low demand was placed on the PS3's price point and and "lack of compelling software titles." The take-away: unless PS3 demand increases in lieu of early mishaps, publishers could also be left in the cold. Maybe more than just gamers are rooting for early price cuts now. The pressure's on.
What do YOU think?
source article: http://www.joystiq.com/2007/01/25/so...for-ea-others/