Thoughts on PS3 Launch Quantities Being Cut
Few folks wrote to ask what I thought about the news that Sony had cut launch volumes from 4 million units to 2 million, and delayed the European launch until March of 2007. In addition, Sony also announced that they would have just 500k units for launch, with 100k going to Japan and the remaining 400k to the US. The stated reason is production issues with the blue laser diode.
Frankly, there's not much to say. Launching a console worldwide is really, really hard, and I'm not terribly surprised. The game industry seems to not be overly-surprised either. Most game company stocks are down by maybe 1%, and even GameStop is only down a point (as of 9:45 this morning). That's noise for these traditionally volatile stocks. I suspect you'll see analysts speaking up in the coming days and basically pointing to the "Wii60" picking up the slack that Sony can't fulfill - people need to put something under their tree, after all.
I think the biggest impact on Sony is that this reduces the number of Blu-ray sockets in the market for holiday. I can guarantee you that Sony's conversations with movie studio execs would have included promises about the number of PS3s that would be sold this holiday, and those numbers would have been used to help justify the investment those studios would have to do in Blu-ray movie mastering and manufacturing. This news is going to make a lot of those studios look twice at their Blu-ray strategy. Sony will likely have to make good on those missing sockets (which could be expensive), and it's quite possible you'll see some of the Blu-ray only studios hedge their bets and start supporting HD-DVD as well.
I don't think Sony will delay their Japanese and US launches until next year, however. Not having Blu-ray in the market for holiday would effectively give HD-DVD a huge boost, and Sony simply can't afford that. Blu-ray (not video games) is what Sony is betting the company on; they can't afford to not launch in some fashion, even if the games aren't there.