In article <4730539.xmlkfsPQke@xxxxxxxxxxxxxxx>,
Roy Schestowitz <newsgroups@xxxxxxxxxxxxxxx> wrote:
> network effect. All it needs is that initial momentum and the price
> cut has just boosted PS3 sales in Amazon by 2500%. Overnight! Some
Nope. That was its movement on the movers and shakers list, which
measures how much its position changed on sales *rank*. E.g., if
something moves from 30 to 10 in sales rank, that is a 200% improvement.
The PS3 moved from around 25 to 1. That could represent a lot more
units, or just a few more units. It depends on the shape of the unit
sales vs sales rank curve for the products currently in the top 25.
A lot of the press totally botched this (even though some of them
actually linked to the movers and shakers page, which explains how it
works--geesh!), and unfortunately that kind of mistake is not uncommon
for the press. It's a good idea to ALWAYS do a mental sanity check on
any numbers the press reports. 2500% sales boost doesn't pass such a
check, for several reasons:
(1) There already was a $499 PS3--the 20 gig model. It did not sell
well. 60 gig vs. 20 gig doesn't really make that much of a difference
for now in PS3 usability as a gaming system, so it seems that if there
were a lot of people that really wanted a PS3, but couldn't afford $599,
they would have went for the 20 gig at $499 long ago, rather than wait
for the 60 gig to drop.
Note that the PS3, unlike the XBox360, is very friendly to hard disk
upgrades. It's not like buying the 20 gig dooms you, if some future
development makes it so 20 gig is not adequate. (And by then, 60 gig
would probably not be adequate, so you'd be upgrading anyway).
Thus, the fact that gamers largely ignored the 20 gig indicates that
very few were staying away over pricing issues.
(2) Sony marketing are not total idiots. They do market research, and
if a price cut could spur a 2500% sales boost, they would know it. They
would not have waited this long to do it. They would have done the
price cut as soon as supply caught up with demand and sales dropped off,
because they know that momentum is important for a console. A lot of
titles that were expected to be PS3 exclusive have been announced for
360 and/or Wii, directly as the result of low PS3 sales. Sony would
have done anything they could have done to prevent that.
--
--Tim Smith
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