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PS3 Is Not the Reason for Sony's Laying Off 100 Staff Members

And even if the PS3 is cheaper to make now, a price cut still isn't in order

Jun 7, 2007 13:52 GMT  ·  By
Sony's HQ
   Sony's HQ

It seems that although Sony is laying off some of its people, this restructuring is not directly linked to the PS3's bad start. What start...? It's been released for quite some time now and it's still lagging behind its competitors. Read on below to find out what Sony meant by "streamlining operations."

Sony Computer Entertainment America has denied that the layoffs are directly linked with the PS3's sales, as NextGeneration reports. "This move is not wholly related to any one product in our portfolio," said SCEA PR boss Dave Karraker when asked if the layoffs were directly linked to PS3 sales. "More accurately, it is reflective of shifts in the marketplace and in consumers' wants and needs, such as the rise of digital content delivery and networked services. In order to maintain our market leadership, the management of SCEA has found it necessary to analyze the business and restructure the company as necessary."

The layoffs mainly occurred at Sony's headquarters in Foster City, Calif, while Karraker declined to provide further details surrounding the specifics of how the employees were informed. Who's the sadistic bloke that asked...? They were most likely announced via email of course, but I'm sure it was more of a reminder as it would be inappropriate for a Sony official to just come up to their employees at lunch break and say: "You're not gonna like this, but in order to 'streamline operations' we'll have to let some of you go, so Peterson, Jackson and all of you guys back there are out!"

The same site mentioned above also reports that Sony's games division lost some 2 billion dollars, during their last fiscal year because of the PS3, but predicts and impressive overall operating profit of 440 billion yen for the current one, (due in part to lowered production costs of Blu-ray diodes and other stuff that makes the PS3 tick).

So I guess this answers the question: "Are we going to see a price cut for the PS3 this year?" Guess not, Sony's using the lower manufacturing costs to their advantage, instead of allowing more people to acquire one.