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Sales not up 2500%, Roy

In article <4730539.xmlkfsPQke@xxxxxxxxxxxxxxx>,
 Roy Schestowitz <newsgroups@xxxxxxxxxxxxxxx> wrote:
> network effect. All it needs is that initial momentum and the price 
> cut has just boosted PS3 sales in Amazon by 2500%. Overnight! Some 

Nope.  That was its movement on the movers and shakers list, which 
measures how much its position changed on sales *rank*.  E.g., if 
something moves from 30 to 10 in sales rank, that is a 200% improvement.

The PS3 moved from around 25 to 1.  That could represent a lot more 
units, or just a few more units.  It depends on the shape of the unit 
sales vs sales rank curve for the products currently in the top 25.

A lot of the press totally botched this (even though some of them 
actually linked to the movers and shakers page, which explains how it 
works--geesh!), and unfortunately that kind of mistake is not uncommon 
for the press.  It's a good idea to ALWAYS do a mental sanity check on 
any numbers the press reports.  2500% sales boost doesn't pass such a 
check, for several reasons:

(1) There already was a $499 PS3--the 20 gig model.  It did not sell 
well.  60 gig vs. 20 gig doesn't really make that much of a difference 
for now in PS3 usability as a gaming system, so it seems that if there 
were a lot of people that really wanted a PS3, but couldn't afford $599, 
they would have went for the 20 gig at $499 long ago, rather than wait 
for the 60 gig to drop.

Note that the PS3, unlike the XBox360, is very friendly to hard disk 
upgrades.  It's not like buying the 20 gig dooms you, if some future 
development makes it so 20 gig is not adequate.  (And by then, 60 gig 
would probably not be adequate, so you'd be upgrading anyway).

Thus, the fact that gamers largely ignored the 20 gig indicates that 
very few were staying away over pricing issues.

(2) Sony marketing are not total idiots.  They do market research, and 
if a price cut could spur a 2500% sales boost, they would know it.  They 
would not have waited this long to do it.  They would have done the 
price cut as soon as supply caught up with demand and sales dropped off, 
because they know that momentum is important for a console.  A lot of 
titles that were expected to be PS3 exclusive have been announced for 
360 and/or Wii, directly as the result of low PS3 sales.  Sony would 
have done anything they could have done to prevent that.

-- 
--Tim Smith

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