Is Sony run by idiots? Playstation 3 price drop not real?

It's real, but...

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Lots and lots of confusion in the Playstation 3 (PS3) market place this past week. First, out of relatively no where a price drop is announced that brings the price of the PS3 console down from the stratosphere into the almost attainable (for most people) $499 price point for their 60GB version of the console.

Next, Sony announced (at the same time that they announced the price cuts on the 60GB model PS3) that they were soon going to be selling an 80GB version of the PS3 at the old $599 price point that the 60GB units sold at. The 80GB model would include the additional 20GB over the old 60GB model, but also would come with a free copy of the game Motorstorm. What wasn't talked about much in that announcement is that the 80GB model will *not* apparently include the hardware that performed the tasks of making the PS3 backwards compatible with the Playstation 2 (PS2). Oooops. (The units will still include backwards compatibility with the PS2, but via software emulation only.) Hopefully the people that waited to get a PS3 won't be worried too much about getting a unit that is guaranteed to be compatible with their PS2 software library.

Over the last 24 hours (give or take, from the time of this article), there's been more news though. News that some folks are finding somewhat troubling and which seems to be an indication that Sony is perhaps pulling a fast one on their customers in more ways than one.

Consider the following headlines and links:

Next Generation (next-gen.biz) has: OPINION: Sony’s Day of Confusion

Joystiq.com has this update to an earlier article: Sony: Enough 60GBs for "several months" in U.S. [Update 4]

An earlier update had said:

Update 2: As you may have seen in this clip about 1:45 in, Kaz Hirai says "The $499 price adjustment that we did for the 60 GB version for the American market, we're no longer in production for that product. So once that product is gone from the retailers shelves, then we're back to the $599 SKU only, so it's not like we have a two price strategy here in the U.S. market, which we found early on consumers react most to just having one SKU as opposed to two." So, we're attempting to get some clarification. You'll know when we do.

There's a few other sources that have been equally as confused...

What this all seems to add-up to is this: Sony will sell their stockpile of 60GB Playstation 3 hardware -- hardware that still contains the hardware to do PS2 compatibility -- but once that stockpile is gone, that's it for the $499 price point, and we're right back where we started with the PS3 price point, only, uh, not quite. You see in the past there was the 20GB unit that was priced at $499, and the 60GB unit at $599. Now we'll wind up with only the $599 price point, and no lower tiers to work from.

The 20GB unit was phased out over the last several months and unless you find existing stock of same, you are out of luck in purchasing same. Even still, officially there was no announcement of the 20GB units finding any sort of price break, so any old stock is still priced at the $499 price point. As if someone would buy those units when the 60GB units are out there just as cheaply.

The 60GB units are there, but only for as long as the warehouses are full. While Sony apparently expects to have about a 4 or 5 month supply of same, that will all depend on how quickly the market buys up the older units.

So, over the next few months Sony will have handed customers a price break, only to basically take it all right back away from anyone that doesn't rush out and snap up a unit soon.

Stroke of genius or sheer stupidity? You tell me. My thoughts are concluded in the comments area below.

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My final thoughts on the topic -- Sony is apparently both brilliant and stupid.

As soon as they announced the price cuts on the 60GB models the market went crazy, and PS3 hardware sales spiked over-night. People like me that were on the fence about buying a PS3 ran out and snagged one thanks to this $100 price cut, and the fact you could get 5 free Blu-Ray disc movies for free by buying the PS3 at this time.

We idiots figured that 5 free movies were worth a few $$, and the $100 price break was about as good as we would hope to see for a while on the PS3 equipment at this time.

That was and still is true.

What is stupid though is that Sony apparently doesn't want to stay at this pricing point. They would still rather put themselves firmly in at the $599 price point. That is just plain stupid. They were seeing very sluggish sales at that price point, and will -- I believe -- continue to experience sluggish sales this winter when the only price point they will have left is that same $599.

Sony was finally, finally, finally getting competitive with Microsoft and Nintendo. They were putting out an interesting product at a price that was starting to drum up business, and now they've just as quickly started to remove that pricing point only to most likely see themselves priced out of the marketplace again.

If Microsoft can get any sort of price break out of their equipment -- equipment which will have been on the market for 2 years by the time the Christmas season rolls around -- they will likely beat Sony over the head with it.

Where Sony could claim that they offered a fully featured console system that doubles as a next generation hi-def video disc format player at a price that no one could come close to, they are just as quickly removing that edge for themselves and leaving Microsoft right there to compete with them, even with the costs of adding an HD-DVD drive to the Elite version of the Xbox 360.

Dumb movie Sony. Very dumb.

Of course Sony might make other moves between now and when the 60GB PS3 is finally 'sold out', but that remains to be seen. Until then, Sony has created far too much confusion in their own marketplace, and that is never a good thing. Nice shooting Sony. Right at your own feet. You all actually make Dick Cheney look like a crack marksman.

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