PriceSCAN Blog

Last week I noted that, in the wake of Toshiba's re-pricing, entry-level HD-DVD players were selling at steep discounts to similar Blu-ray machines ("We Still Refuse To Pay You To Own An HD-DVD Player!"). At the time I noted the Blu-ray premium could be indicative of reported greater demand for the Sony standard, though neither Blu-ray nor HD-DVD can yet be said to have gained widespread acceptance. Now Sony has cut the list price of its BDP-S300 from $599 to $499, crediting improved efficiencies of production and a drop in component costs for its ability to do so. Does this mean Sony is blinking in the face of Toshiba's aggressive pricing?
Not necessarily. First, it's worth noting the new Sony pricing brings the BDP-S300 more in line with that of other firm's Blu-ray players, notably Samsung's BD-P1000, now offered for slightly less than $430. But there may be more to it than this. Compared to Sony's Blu-ray equipped PS3 unit sales, Microsoft's has sold three times as many Xbox's and Nintendo has sold twice as many of its newer, white-hot Wii consoles. Currently, the PS3 is offered for no less than $599 by merchants on PriceSCAN.com, compared to $299 to $480 for various Xbox models. The Wii goes for around $250. These price differentials may well have cost Sony considerable market share. Even if the PS3 is regarded as a kind of "sacrifice play" to enhance Blu-ray acceptance (see "Blu-ray May Avoid Betamax's Fate…Even If The PS3 Isn't So Lucky") that stratagem would be blunted by unit sales constricted by a high price point. If Sony can now make Blu-ray players for less, it might behoove the firm to pass on that savings to prospective PS3 buyers, and indeed the web is rife with speculation such a move is imminent.
But Microsoft is offering an HD-DVD drive for the Xbox, and the cheap and popular Wii raises the question of whether many gamers even care about high-def. In this environment, a Blu-ray-driven PS3 discount may be the first shot in a tech and price war that could run right through the summer and into the holidays.