Stringer Claims PS3 Losses To Double

Sony chairman and CEO Howard Stringer has suggested the company will seek to offset losses associated with the launch of the PlayStation 3 by improved profits from the company’s movie and consumer electronics divisions, as estimates for the losses incurred by the PlayStation 3 increased. As quoted by the Reuters news agency, he commented: "Considering some of the additional costs of PlayStation 3, we have to generate some excitement and profits from elsewhere in the company to offset the performance of PlayStation 3." New projections from Sony indicate that the company expects losses in the games division to double from initial estimates to ¥200 billion ($1.7bn) by the end of the company’s financial year in March, in part due to the 20 percent price cut recently announced for the 20GB hard drive version in Japan. Stringer claimed he was confident that the PlayStation 3 would perform better, and prove more profitable, in its second financial year as software sales - always the primary source of profit for any console manufacturer - increase. He also predicted general profit margins of 5 percent in the next year for the Sony group as a whole. "I think the idea of worrying about a delay in PlayStation is slightly strange to me. Every complex technology runs the risk of delays," said Stringer. "The point really is that PlayStation 3 is already finished and has been tested in America and has been deemed a creative success. In the end that is what counts."