CE-Oh no he didn't! Part XV: Sony Australia exec calls the Wii "a bit pricey"

Welcome back to CE-Oh no he didn't, the game show where company executives get to mouth off about something that surely won't make their bosses happy. This week, we're playing with Michael Ephraim, managing director of Sony Computer Entertainment Australia, who made a very insightful comment recently about the pricing of a rival product. Now, while prospective buyers have grumbled at the high price (AU$1000, or $743) of the PS3, Ken Kutaragi, the head of Sony Computer Entertainment, has maintained that the company's latest console is "probably too cheap," but acknowledges that it's a "expensive toy" -- although to be fair, Sony did just drop the price in Japan. Well, it appears that Kutaragi's minions don't necessarily agree with his assessment, or at least Ephraim appears not to. He recently told The Age (Melbourne's major metropolitan daily) his opinion of the Nintendo Wii, which will retail for AU$400 ($297):

"My only question for this Christmas on Wii is the price point. Even though it's affordable, at $400 plus whatever you need to buy accessories-wise, I'm guessing you need to spend about $500 to take home a Wii and enjoy it. For this Christmas, I think that price point is still not family entertainment because $500 is a lot to fork out . . . I think the price for what it specifically does as a video games machine is a bit pricey, but I think that their strategy long term we have great respect for."

So by that logic, mate, the AU$1000 PS3 will be what, exactly -- really frickin' expensive? Not to mention it'll be even more than AU$1000 when it comes with all its accessories too, y'know? So that makes your PS3 even more than twice as much as the Wii, which you say is "a bit pricey?" Mike, wouldn't you think that would mean that you'd want to, um, perhaps bring the price a bit down? Can't you call up your buddy Kenji and tell him what you told those Aussie reporters? Or maybe perhaps your colleague across the Pacific, the Kazmeister? C'mon, you guys could set up a meeting in somewhere convenient for all of you (say, Honolulu?) and work out the details. Then everyone would be happy, especially us lowly consumers.

[Via Joystiq]

[Hired.Geek @ Oct 11th 2006 11:23AM]

Once again it is Engadgets fault that some one at Sony opened their mouth before engaging their brain. Maybe it was an Engadget employee that had one of those really cool rubber masks like we saw in Mission Impossible and gave the interviewer a fake interview saying all this werid new math kind of figures. If this is truly the case I hope they do a DIY post on how to create these masks, and second then they should be scorned. Now I will say that Engadget does put a certain tone to their articles, but I do not beleive that it is bias toward Sony but more of an attempt to be funny and poke fun at the content of the statement. Now while this might be funny if the statement is about a product you do not like or do not care about, it sometimes leaves people with a bad taste in their mouth if it is a product or company that they own or really like.

I am not sure how many times I am going to have to say it but I guess it will be at least one more time. Engadget simply reports the news, they do not make it (Well not to often)!

[Dario @ Oct 11th 2006 2:51AM]

hahaha does wacky foreneirs!!!

[Intrepid @ Oct 11th 2006 3:06AM]

Yes, because Australia is such a wacky country... I mean, what sort of country has a literacy rate that is almost 100%? And what sort of country controls some of the worlds largest uranium deposits, but has never used them itself?
Ummm... let me think - oh yes, they must be crazy.

Anyhow... I think Mike is an idiot and should stop talking crap. Accessories will bring the price up by $200 or so, and that'll also happen with the PS3... so whats his point?

[K2 @ Oct 11th 2006 2:57AM]

This isn't exactly fair. Yes, the PS3 is ridiculously expensive, and sony execs have a history of talking out of their asses, but the man does have a point. The Wii isn't much more than a glorified gamecube in terms of raw power; spending 400-500 USD (after games+accessories) seems like quite a lot. No knock on the Wii itself, it looks fun and I will probably be getting one, but the PS3 does have much more tech under the hood. Just my 2 yen...

[theChad @ Oct 11th 2006 8:13AM]

They're talking in Aussie dollars, not American dollars.

[K2 @ Oct 11th 2006 8:54AM]

theChad,

I know they're talking in aussie dollars. I think you could easily spend 400 USD on the Wii after getting extra controllers, nunchuks, a couple of games, etc. The Wii itself is going to be $250. An additional $150 is easy to spend. 500 USD may be a little too much to spend, I suppose.

[Hired.Geek @ Oct 11th 2006 9:35AM]

But how much are you going to spend to get a playabled PS3. You buy the unit itself and an extra controler and a few games, and I bet you will have close to $1000 USD (even buying the cheaper model). And as for all that tech in the PS3, I think most people just want to play video games, so the Blu-Ray player is really not that important to allot of true gamers as trying to have a new gaming experince with the Wii.

[theChad @ Oct 11th 2006 9:45AM]

I know it could add up to that with extra controllers and games, but that should also be taken into account with the PS3. Ephraim is just adding $100 AUD to the price, which I'm guessing amounts to an extra game, maybe the classic controller as well. He's not adding up a couple games and full set of controllers.

[tzhuge @ Oct 11th 2006 12:19PM]

Let me just point out that the market ultimately determines what price is reasonable not the amount of technology in the product. The fact that Nintendo can actually make money on sales of Wii is a reflection of how much value consumers place on the innovation of the Wii. So, it's not overpriced if they can actually sell all 5 or whatever million units by the end of the year.

[Zac Grose @ Oct 11th 2006 3:00AM]

Thanks for a great article, Cyrus. Very interesting to read.

I do have an itch for a Wii, even though I've never been a Nintendo person. I just think the possibilities for games like hockey will be great.

[Panzer_V @ Oct 11th 2006 3:03AM]

so let me get this ... a PS3 20GB Model :
In Japan $430USD
In USA $499USD
In Australia/Europe $625USD ( $125USD increase over USA price and $195 over Japan price)

Wii
In Japan $225USD doesn't include wii sport
In USA $250 with Wii sport
In Australia $300USD with Wii sport ( a $50 price increase over the same package sold in USA )

Sony really treats is customer fair :)

[Zac Grose @ Oct 11th 2006 3:06AM]

It's called a pwned fee. We're used to it here in Australia. Ever compared prices of computers from here to the US?

No biggie, the same problem plagues Europe. Just check the Apple prices in Ireland.

[donkeykwong @ Oct 11th 2006 3:20AM]

you forget that australia has a 10% GST and thats included in the cost, also were in PAL land which usually for some mundane reason, incurs an extra fee. The US prices do not include your regional sales taxes. If sony treats its customers fairly, im still waiting.

[db84 @ Oct 11th 2006 3:05AM]

As per usual, someone's comments are taken too literally or the main point is completely overlooked. What the Sony exec meant was that given the hardware and functionality (it costs less to make a Wii - hardware and funtinality is less than PS3), the Wii is not all that cheap. Obviously the Wii will be cheaper than the 360 or PS3 because the actual parts needed to make it cost less. So even though the the Wii may give you as much enjoyment (or more for some)than a 360 or PS3, the Sony exec's point is still valid. For the overall hardware specs and future expandability/funtionality of the Wii, its price could be seen as somewhat high. You cannot just compare the price of the Wii and the PS3 and say the Wii is a better deal. That's like asking why a Lexus is more expensive than a Toyota. You may have just as much fun in the Toyota, but there are added features in the Lexus which warrant a higher price.

[Hired.Geek @ Oct 11th 2006 9:39AM]

Your right there is allot more tech under the hood of the PS3.

But you do not see the execs at Lexus opening there mouths and saying that the amount of money you pay for a Toyota is kind of expensive compared to the amount of money you pay for a Lexus.

[donkeykwong @ Oct 11th 2006 3:11AM]

Just to be a bit picky with the post, The Age isnt the major metropolitan daily for Melbourne, i live there. The major newspaper is The Herald Sun, The age is the secondary paper.

In relation to the article, im not surprised with this rhetoric coming from the Age. This interview will prob come out in print on Thursday in their tv/tech liftout. The games editor (Jason Hill) is in my opinion, sony's whipping boy. If you look at his articles from the past year, there is a lot of pro sony content, and very little anti-sony, microsoft, and nintendo content. The interview reads more like a press release rather than a hard hitting interview. His E3 report (http://www.smh.com.au/articles/2006/05/17/1147545333627.html) was 75% about sony, even though the wii and the xbox games had more news. Also news of the ps3 delay in Australia was dumped to the small little short news section near the ads.

The herald sun never gets exclusive interviews with sony because they actually criticise their actions just like the rest of the gaming journalistic community. The HS is australias largest newspaper, with 1.5 million readers daily, and just today had a whole page article criticing sony for its delay till march for the PS3.

Comments like those made would not go to print or wouldnt even be said, if our aussie jouno's (like jason hill) would get their act together and give us something that we dont read in the brochure. Jeez even OPSM gives better editorial content.

[red_xiv @ Oct 11th 2006 5:46AM]

Come off it. Those comments were extremely fair, MATE!

I've lived in Aus all my life (still do), and when you can pick up a gamecube for less than 99 AUD, and a wii + an extra control costs $500, offers non-substantial graphical improvements, has no ethernet plug, has no hdd, can't even play dvd's, and a PS3, which has all these things, excellent graphics, the ability to play dvd's/blu-ray/sacd and all that, and much more, and only costs like $830, plays virtually all PS1/PS2 games natively, the $500 is looking like less value than the $830.

Do the engadget bloggers have any grasp of how poorly the gamecube is received in our "downunder" country? You have to search pretty hard to find gamecube games/accessories here in Aus, and there's a reason why the price was slashed so much.

At 189 AUD, the PS2 is much better value than the 99 or sub 99 AUD gamecube. Similar concept, it's all dependent on what the thing offers you, and whether or not you want that or not.

The comments were fair, and qualified!

Can we start an En-gad-get-Oh no they didn't!?

[Reg @ Oct 11th 2006 3:18AM]

Um, doesn't the Wii come bundled with one Wii-Mote and NunChuk [sic], and, at least in the US, the Nintendo Sports edition for $249? I think you can pretty much enjoy the Wii with that alone. Granted, you might want to buy more games, but that is the case for all consoles. Also, the Wii accessories don't appear to be too much more expensive.

Anyway, regardless of the presumably exorbitant prices on the Wii, I will still be buying one this year. And maybe, just maybe sometime in the next year or so when the price goes down to sub $300 USD, a PS3 as well.

Yeah, good luck with that console thing this holiday season there Sony!

I hate their arrogance with their friggin' Cell processor talk and Blue-Ray spin. It's just a game console. You know, for gaming. It's not some luxury home appliance so quit with the arrogance already and just put the "Play" back in Play-Station once again.

[Iain @ Oct 11th 2006 3:18AM]

I really wonder what he was thinking as he said that. Can't take the questions eh? These guys sure fail at improv.

[Gil @ Oct 11th 2006 3:57AM]

PAL/NTSC is an arhaic problem. My two bit DVD player bought at a discount can play both equally well on any sort of TV.

[spaz @ Oct 11th 2006 3:33AM]

I think what he means to say is that AU$400 is a lot to pay for a repackaged GameCube.

[SimbaDogg @ Oct 11th 2006 3:50AM]

how is it that EVERYONE that writes articles for engadget, can be so blindly biased against sony? this is really starting to make me sick, and for the most part...i dont even want to read any of the "gaming" news. Worse than getting news from FoxNews...

[SHOTT3R @ Oct 11th 2006 4:03AM]

Your post illustrates perfectly one of the major problems plaguing the population - binary thinking. No there are not always two sides to every story. No the truth does not always lie in the middle of two opposing viewpoints. If Sony f**ks up 10 times in a month (which they seem to be doing), don't blame Engadget for carrying 10 'negative' Sony stories, when all they are doing is reporting the truth.

Not to Godwin things, but people like you would probably have been the ones yelling "But what about all the good things Hitler did? Why are you so biased against him?".

(and for the inevitable idiots, I'm not comparing Sony to Hitler. It's just an example.)

[NastyButler @ Oct 11th 2006 4:01AM]

Just a thought...

I recall that when the Sega Saturn and Playstation 1 were first released in Australia seeing prices in the AUD$750-AUD$850 range - surely taking into account inflation and the like (not to mention the introduction of GST - 10% mandatory tax on all luxury goods) the jump to AUD$1000 is not crazy.

The fact that I live in the UK now, and will end up paying the equivalent of AUD$1200 for it is neither here nor there, though...

[Idk @ Oct 11th 2006 4:12AM]

Michael has a great point. Anyone who thinks that he's wrong is an idiot.

For the price it costs to produce a Wii, they could be selling them at $80 and still be making a great profit. The So called, interactivity of the Wii, Does NOT make it cost more to make. It should be something to make people want to buy it. They shouldnt be displaying the Wii-mote as something new, because it isn't.

The same motion sensor concept has been used for numerous years, but when nintendo throws it out there, it's new, and innovative?

[x23 @ Oct 11th 2006 5:10AM]

"For the price it costs to produce a Wii, they could be selling them at $80 and still be making a great profit."

care to share a link to back up that fact? or is it actually something you just made up off the top of your head?

[Hired.Geek @ Oct 11th 2006 11:23AM]

While you are right the motion sensing is nothing new, this is the first time that it is something more then just a gimick. The idea was completely thought out and the console was built around the idea of using motion control instead of adding three new buttons on the controller.

I find it really hard to beleive that they can make the Wii for under $80. But you have to remember that any of that mark up price is also going to keep the online service going.

[Matt Errend @ Oct 11th 2006 4:17AM]

The Wii really is a little over priced for what it is, however. I have heard that it costs as little as $40USD to produce an entire Wii console, including labor and packaging.

[Anaximander @ Oct 11th 2006 9:42AM]

@ Matt Errend: Wrong. It costs a lot more than just $40. Its more like almost $200 at the very least.

[stuart @ Oct 11th 2006 4:10AM]

he said `I think the price for what it specifically does as a video games machine is a bit pricey' and would presumably therefore defend the price of the ps3 on the inclusion of bluray DVD - it's not that hard to infer is it?

[theinvisiblemooseman @ Oct 11th 2006 4:50AM]

there is no way the wii costs $40 to produce.

[alloneword @ Oct 11th 2006 4:52AM]

The Sony price is incredibly high (I live in Australia).

But the Wii is not cheap. It is the most expensive console nintendo has ever launched, which makes sense, it is a big jump from a GC, those controllers can't be cheap.

The controllers are going to be pretty expensive.

Australia does get ripped off with gaming stuff.

A Wiimote + Numchuck will cost us in Australia $100(Aussie Dollars). In the USA it will cost about $80(Aussie Dollars). Even if you factor in Tax (10% here, still losing $12, or over 10%. Not a whole lot, but an increase for no apparent reason.

The Wii is not priced as something a family could pick up for Christmas here. It is about $50(AUD) too much. If it came with a 2nd Wiimote (even without the numchuck) it would be a lot more compeling, or if it included a classic controller as well. Especially since some future games will only use the classic controller.

Games are really expensive here too:
http://www.aussie-nintendo.com/index.php?v=article&p=5498

Australia ends up paying 20-30% more for games.

The PS3 is insanely expensive. That doesn't mean the Wii is cheap. But Sony really is the pot calling the kettle black.

[TheCount666 @ Oct 11th 2006 9:01AM]

Why must the controllers be expensive? Because they're motion sensing? That type of motion sensing (which requires an external sensor) isn't as expensive to impliment as you might assume.

The main difference between Microsoft/Sony and Nintendo's gaming strategy is that Nintendo is not willing to break even on sales of their console and make it up on games and accessories. At $250, Nintendo WILL be making a profit on every Wii sold.

The Sony guy is right, if they went with the same strategy as the other boys, they could probably have sold the thing for the rumored sub $200 (USD) and still made a small profit on the console and tried to make it up with games.

[?? @ Oct 11th 2006 5:12AM]

I think everyone is looking at taking cheap shots (aka misquotes) at Sony now because of the console delays.

He said "I think the price for what it specifically does as a video games machine is a bit pricey". This is true.
PS3 is much more than a video games machine.

Therefore, he is reading from the same page as all the others

[Vale4606 @ Oct 11th 2006 5:09AM]

Was in World Square, Sydney today and the Sony store has a sign stating they are taking PS3 preorders

high end $999
low end $830

[Codepope @ Oct 11th 2006 5:10AM]

So nobody actually read the interview? You know, the article which is all about Sony pricing the PS2 at $200AUD, and is actually comparing the PS2 pricing with the Wii? This is Sony's double play, they aren't pulling the rug from under the PS2 as the PS3 arrives; like the PS1, they are keeping it around while the next machine establishes itself, and in the process hoovering up low end customers.

[Linh @ Oct 11th 2006 7:03AM]

glorified gamecube or not, it is still more expensive to produce. Tack on the fact it's R&D for the wiimote, and I'd say $200 is a fair pricepoint for the console+game to make a huge killing.

but nintendo is a company. their aim here is to attract non-gamers and broaden their userbase. these people don't care about the technical facts of it being a glorified gamecube (granted, it's still a ~2x speed increase, no? plus it's easy to develop for). and simply put, nintendo can't afford NOT to attempt to profit.

this push for HD content is a still a little too new I think. Sony has commented that online distribution is the future... so why do I need a bluray drive now? to push it, that's why.

but all the argument over which console will win, what to buy.. it's all just over the top now. just get whatever the hell is fun and *worth* it to you. If HD now is your goal, go grab a ps3. If you're into something new, hit up nintendo. online gaming fun, go buy an xbox.

[Kenjix @ Oct 11th 2006 7:11AM]

Yeah I would agree with Sony on this one, I may not want to spend $600 on the PS3 but when I look at what it's offering in terms of tech specs and features I get it. I don't get the price of the Wii so much, maybe if it were $149 with a second controller I would understand. It's also important to realize that Sony is taking a hit on the Hardware and Nintendo isn't making a small profit but a Huge profit, which means there's plenty of room to drop that price. I would say the Wii is over priced for what it's offering.

[nojok3 @ Oct 11th 2006 7:14AM]

I think his point was that the Wii is considered last gen technology minus the new controller. Like paying $500 for an xbox with a motion sensored controller. I have a 360 and don't plan on getting a PS3 but I see what he is saying.

[Jamie @ Oct 11th 2006 7:35AM]

At least sony has the balls to face the competition unlike some corporate heavies (that shall remain nameless) that prefer to take shots at it using nerdy bloggers (who shall also remain nameless :).....)that surf the net looking for anything, word, phrase, sigh that can be portrayed as "no he didnt". Sure the fanboys will lap it up, but true neutral gamers shall see through all the BS.

[mj @ Oct 11th 2006 7:50AM]

Well what he is mentioning is upto some extent correct. When you compare price/functionality ration Wii is not offering much at 299USD except playing games at SD resolution. Whereas PS3 is having much more offering (including Blue-ray player - which itself costs 900USD in retail market). Engadget needs to report things more accurately (although you might not be getting enough stories from Nintendo...)

[JinKazama @ Oct 11th 2006 8:13AM]

I basically agree with what the majority of folks are saying, a gamecube with a little more RAM, an updated processor, and a new controller does not justify $249 in my book ($149.00 absolutely...).

I was really excited about the Wii at first, but as more and more details come out, the less excited I have become. IMO another blogger said it best, "the Wii will be the Snakes on a Plane of gaming" lots of internet buzz, underwhelming in actuality.

[darkdog @ Oct 11th 2006 12:47PM]

the PS3 is more of a repackaged PS2 than a wii is a repackaged gamecube. new technology? nice. blu-ray drive? awesome. but the games will feel the same as they did on the PS2, you'll play them pretty much the same way. you get a "repackaged gaming experience".

if the wii was indeed a repackaged gamecube, then there woudn't be any virtual console, wireless networking, free internet gaming (as far as i know) and LAN gaming as well, and a completely different way of playing its games. the concept of "repackaging" goes far beyond the basic hardware, where most of the people are stuck at.

[Liam McNulty @ Oct 11th 2006 10:44AM]

Probably because Lexus and Toyota are run by the same people?

[Earl @ Oct 11th 2006 9:45AM]

Of course Nintendo wants to make a profit from the Wii! They are a gaming company! Sony makes TVs, sound systems, DVD players, computers... etc. Microsoft is known for Windows OS (obviously). Nintendo has gaming as their source of income, with the exception of merchandising.
Look at the facts: the Wii is the only console that will be changing the way we play games. Yes te PS3 contoller has some motion sensors, but that is not to the extent of the Wii. Certainly not to the extent that every game made for it will be based on the motion technology. PS3 isn't trying to change the way we interact with games. And who the hell doesn't have a regular dvd player anyway? For those that caomplain about the Wii not playing dvds.
Gaming console=games; dvd player=dvds
If you want "new tech" gaming system, build/buy a computer. That's what I do. That way when new gaming technology is available, you can just easily upgrade your computer. The PS3 will be stuck as the PS3. Quite honestly, from current "production problems" those blu-ray drives, when first shipped, are going to be majorly defective anyway. Well that's my feeling. Plus who knows who will win the next format war, you can have a PS3 in 2 years with no blu-ray movies available.
Point is that the PS3 is way too expensive for an untested technology, that may not have any other industry support other than Sony. Yeah the graphics will be amazing, but who cares if there are few good games to play. I don't know about others, but I buy games based on their replay value. I rent games that I only want to play once. Who wants a game to just play it once, then collect dust? I love graphics also, but if the game is not "fun," then who cares?

[Gamey McGee @ Oct 11th 2006 9:59AM]

This guy was pointing out the the Wii is ONLY a game machine. The PS3 plays high definition movies and, at it's price point, makes more sense for the market it is aimed at.

HE IS CORRECT that the Wii is overpriced for what it delivers. The PS3 could always be cheaper, I don't argue that, but the fact of the matter is that it's a game machine and a next generation movie player NOT JUST ONE OR THE OTHER. And, if you look at the price adjusted for inflation, the PS3 at $499 is NOT that outrageous for what it delivers.

[Idk @ Oct 11th 2006 6:11PM]

If your a gamer. Which would you get for your pc, A 6 year old (OC'd) gpu that costs $50, or a new one that costs $500? These are your only options.


))(( Do NOT reply to this, instead, just think about it.))((

If graphics in a game dont matter then why are Nvidia, and ATI, multi Billion dollar companies. Why do the same people who say "it's all about gameplay" buy a new GPU every year, or every few months.

I'm sorry to say this but, try running a game, any game, on a 32" lcd in 640x480, then come back and tell me that you want to play games like that for years 2 come.

What about us who do not own a SD tv? If you have an HDTV, which most people have now (considering that you can get one @ $299 now), plug your PS2 or GC into it. then tell my that it's even acceptable.

Once again, I will NOT read this after i post it, DO NOT RESPOND.

[theChad @ Oct 11th 2006 11:30PM]

All kinds of flaws in this argument. Most people don't have HDTVs yet. Also, it's not like "A 6 year old (OC'd) gpu that costs $50, or a new one that costs $500." It's sticking with a certain architecture or upgrading to a new one altogether. Look at the 360 with software emulation or PS3 with legacy hardware to enable BC games. If more power meant upgrading architectures PCs wouldn't have run on x86 for as long as they have.

[Zhoe Garcia @ Oct 11th 2006 11:24AM]

he's right, but when you have a ridiculously priced system hitting the market, you should STFU!

my 2 pesos

[Grizz @ Oct 11th 2006 10:14AM]

I say let them charge whatever they want for it. Its their fault if its not a good value.

And if it spells doom for the console, then that good for me, i like anything thatll bring the PC games back to the front of the store.