Sony is a giant of the Japanese industry and when the company sneezes, the whole country catches a cold. Well, there's sure to be an upsurge in the sales of tissues in Japan as Sony announced that, for the quarter which ends on September 30, profits took a 70% tumble. In a statement earlier in the month, the company said that a stronger than expected yen and the worldwide economic downturn would affect its results.

 

The bright spot for gamers like us is that the games division of Sony is actually one of the best performing sections of the company. Revenue derived from sales of gaming consoles and of videogames has gone up by 10% and there are signs that the next quarter might see even better results. The games division still registered a loss overall, in spite of growing revenue. It amounted to around 405 million dollars, far less that the losses of 2007, which stood at 992 million $.

 

The PlayStation 3 was the best seller of the games division, with 2.43 million consoles sold in three months, which is almost double the same period in 2007. The console now has a lower manufacturing price so the profit margin on each unit sold is higher, contributing to reducing losses.

 

Sales of the PlayStation Portable increased modestly, although Sony has great expectations regarding the new PSP-3000 model, while sales of the PlayStation 2 were down to around 2.5 million units.

Sales of software for the PS3 more than doubled over 2007, reaching 21.1 million dollars. Still, there's room for growth, with the average PlayStation 3 user buying less games than the average Xbox 360 user.

 

The big problem for Sony is that Microsoft is trying hard to make sure that the Xbox 360 sells better than the PS3. The September price cut is followed by the impending launch of the new Xbox Live Experience which will be accompanied by a big advertising campaign. And there's also a title called Gears of War 2 coming out for the Microsoft console, with Sony being hard pressed to find a similar caliber title for its PlayStation 3.