Posted on January 7, 2013, CJ Miozzi The PS3 and Xbox 360 Have Made “Huge Losses,” up to $8 Billion?
According to calculations made by former EA and Sony man Ben Cousins, the PlayStation 3 and Xbox 360 have collectively cost Microsoft and Sony just under $8 billion in losses, despite having sold 70+ million units of hardware each.
Sourcing Microsoft and Sony financial reports, Cousins analyzed the profits and losses of the two giants’ gaming divisions from as far back as two years preceding their respective console’s launch to the present. His numbers spit out a total loss of $2.996 billion for Microsoft and $4.99 billion for Sony.
Cousins highlights the fact that consoles are sold at a loss and that companies “hope to make back the money from the license fee they charge for every game sold on the system.” He goes on to say:
“In order to offset the huge cost of hardware production, distribution, R&D and marketing, a hardware platform holder must sell vast quantities of hardware, and even bigger quantities of software. So much needs to be sold, in fact, that the data points to PS3 and Xbox 360 having made huge losses, despite having sold 70+ million units of hardware each.”
While it isn’t outright stated, the implication seems to be that those “huge losses” — the $8 billion figure — factors in hardware and software sales.