lupi
Lifer
- Apr 8, 2001
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Originally posted by: LegendKiller
Originally posted by: LordSnailz
This is definitely a victory for Sony. True they spend lots of money promoting blu ray, but guess what it worked. They're the only game in town now. Even though you say Toshiba never really put any kind of money into the promoting hd-dvd, they'll stand to lose a lot more than Sony.
The amount of money spent between the two is grossly disproportionate.
1. Sony spent a few billion to subsidize the Blu-Ray player in the PS3, by some estimates that alone cost them $2-3BN.
2. Sony purchased a movie company to keep it from HD DVD hands, cost was $2.9BN
3. Sony then bought Warner Bro's exclusivity for another $500+ Million.
4. Toshiba spent a reported $250M for Paramount and then a few hundred million for player subsidies and wind-down.
Sony might be able to recoup some of the almost $7BN cost that Blu-Ray incurred, but it will take years to do so. Meanwhile, the velocity of technology change is quickening, which may make Blu-Ray obsolete in less than 5 years. That means Sony needs to have $1.4Bn in pure profit from Blu-Ray per year over the next 5 years to just *break even*, not even to gain actual profit.
Who got the shaft on this deal? Definitely not Toshiba. They gambled, lost a few hundred million, moved onto the next business. BFD, companies do that all of the time. It's not often that they sink ~$7BN into a line that has marginal ability to turn a profit.
Add to that the new reports of a Sony-Toshiba deal for toshiba to supply chips for the PS3 and other items and it seems maybe sony even tried to pay HDDVD to go exclusive.
