Sony artificially inflates PSP Go price

By Justin Mann on June 26, 2009, 10:03 AM
When new products hit the market, you usually expect early adopters to end up paying the most for them. The iPhone, Xbox 360 and PlayStation 3 all serve as examples of products that are now much cheaper than on launch day. However, when one of these receives a technical refresh or is replaced by a successor, it rarely comes with a price hike as well. That will not be the case with the PSP Go, which will be priced significantly higher than the current PSP-3000 at $250, despite dropping the expensive UMD drive in favor of cheap flash memory.

Why the increase? Joystiq might have the answer, with a short blurb from Andrew House of Sony explaining some of the justification. When prompted if the increase in price was related to R&D costs or if they were seeking to make retailers happy with a better markup, the answer was no to both questions. Instead, it was revealed that Sony believes there’s a certain “premium” that gets attached to a product simply for the novelty factor; Sony will charge more for the PSP Go because they can.

Uncommon? Not at all. You can fire shots at any high-tech device and claim that customers were being overcharged in the beginning. If people are willing to pay the high price, the manufacturer will surely be willing to collect on it. If enough people got wind of such actions, though, you might see the number of early adopters dropping off – forcing manufacturers to drop their prices down to reality sooner rather than later.




User Comments: 13

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raybay said:

But is it any good? Are there reviews out?

The internet, ethernet, and electronics are all about making money...

Some devices are worth it.

Tell us more

Eddie_42 Eddie_42 said:

because they can...what a novelty in a capitalist society.

Nirkon said:

For that price, who wouldn't rather get an xbox??

polidiotic said:

There's nothing wrong with pricing something high, expecting people to buy it... because people do buy it. Unfortunately for all of us, we're not all made of money, but there are many in the world who are CEOs, VPs, CFOs, Executive Managers, actors, directors, etc, etc, etc... who have a ton of money to spend... and $250-$50,000 is not a lot of money to them. It's like dropping a few dollars for a new pack of pens that you need at Staples.

So, let them have their expensive as shit products... when the wealth has them, sales drop off, then they drop prices for the rest of us. It's all good. ;P One day, you too could drop $42k on a 180" LED LCD HD television.

TomSEA TomSEA, TechSpot Chancellor, said:

(shrugs) I've been guilty of buying products at a higher price than I really should have just because of the "I GOTTA have it" factor. Video cards and computer games for example. On both those if I'd waited six months I would have been able to make the purchases at a significant discount. But I'm fully aware of that and make my decisions accordingly.

I don't see anything wrong with it. It's one of those "what the market will bear" sales strategies.

T77 T77 said:

i agree with Nirkon.i would rather get an xbox with good graphics at that price rather than a portable with average graphics.

Justin Justin said:

I like the PS3. From a hardware standpoint, it looks like a great device. I also like the PSP Go. On paper it looks great.

But, just like the PS3, I think Sony will eat into their own sales with such a high pricetag. Not just now, either, but down the road - I've heard many people tell me that they won't buy a PS3 because it is too expensive. The funny part is, if I ask them how much it costs, most of them will recite a $600 price tag or more - despite that it has dropped significantly lower than that.

I think shocking the customer on launch with a massive price tag than lowering it later can actually harm your sales rather than boost them. Why not offer it at a lower price at first, get a billion people to buy one, then raise the prices later when the "late adopters" feel left out?

raybay said:

Sony has been mostly wrong in their marketing for years.

They make great monitors, good cameras, and below average everything else... with high costs and high failures in laptops and sound.

What are we paying attention to Sony, anyway?

tengeta tengeta said:

"The PS3 just isn't making us enough money, what do we do?"

"Well, lets find a system people are buying... OK! The PSP, lets reinvent the shell, and throw in a few super cool features everyone will want wither they really care or not and jack that price tag through the roof!"

"Hey look, it doesn't matter anymore that the PS3 is losing us money!"

Welcome to modern corporate product improvement. No actual improvement, just visual changes that "justify" new and higher pricing. I still have my original PSP and plan on keeping it that way. If it breaks, I'm not buying one of these.

Guest said:

Supply and demand anyone? Surely this is gcse economics...

Guest said:

This headline statement certainly fails economics 101.

A price is simply what someone want's to demand for goods.

The optimal price is the MOST that someone pays for an item.

Anyone who produces their own goods can demand any price they want; they may not find the optimal price and sell short, or have a sub-optimal price that sells plenty but for less return than they could have, but it's their own price.

An 'inflated' price occurs when something happens that causes the value of something to rise but has nothing to do with the actual item itself. Example: it floods, so rafts become more valuable. The rafts are no different than they were before the flood, but their value has risen. Usually to be considered inflated and not legitimately worth more the external conditions are temporary and short lived.

An 'artificially inflated' price is when those same external conditions are 'manufactured' coercively by an outside source, usually by the government (Example: Interest Rates).

But since it's Sony's product and they decide the value of their product, they can not be 'artificially inflating' the price of their own product. You could consider that maybe by them creating a 'shortage' of the product, but definitely not by simply asking more than some people think it's worth.

It's fine if you want to complain about the high asking price, and I'm not gonna argue if you wanna use big kid words to try to sound smart, but at least google your terminology before you gallivant your lack of understanding all over the internet. It hurts your cause exponentially.

Guest said:

@Justin

What Sony should do is keep the price of PS3 at $600, but offer a $200 "instant rebate" to make people think its a deal. A lot of people will think they are actually saving 200 dollars, instead of spending 400. It reminds me of the Billy Mayes (RIP) commercials where you're getting a 400 dollar value for ONLY 30 dollars!

Twister123 Twister123 said:

When new products hit the market, you usually expect early adopters to end up paying the most for them. The iPhone, Xbox 360 and PlayStation 3 all serve as examples of products that are now much cheaper than on launch day. However, when one of these receives a technical refresh or is replaced by a successor, it rarely comes with a price hike as well. That will not be the case with the PSP Go, which will be priced significantly higher than the current PSP-3000 at $250, despite dropping the expensive UMD drive in favor of cheap flash memory.

Read the whole story

Initially all products are expensive , companies are always trying to revamp there products ,psp is so under developed , a bit like the ps3 , I get the impressing they dunno what to do with either product ,if you want a laugh read guest before the one above ,commenting on your vocabulary , and see some of the words he's usin

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