stevo

Today was the launch of Sony's PlayStation 3. It's retailing for $600.00. What I don't understand is why Sony has fixed the price at $600.

Demand far exceeds supply. Only 400,000 units are available between now and Christmas. It is near impossible to get one. There were 500 people lined up outside Circuit City in Tallahassee last night to receive one of six raffle tickets that would allow them to purchase on of the 6 units Circuit City received (they received 10, but employees already purchased 4).

The game console is selling for over $3,000 on eBay.

I would say at least 90% of the people in line last night only wanted the system at $600 so they could sell it for $3,000 today. But that begs the question, why doesn't Sony just set the retail price for the first 400,000 units at $3,000? That’s what the market is dictating. Is it a public image issue? Does it have more to do with marketing and PR than it does strictly economics? Do they not want to seem like they are 'gouging' the public?

We hear over and over that companies lose money on the consoles only to try and make money on the games. Well, they wouldn't lose money if they priced the systems at what the market demands. If the 400,000 units were priced at $1,200 they would still sell out today. Priced at $2,000 I'm sure they would sell out by Christmas.

An accurate pricing would remove the gray market, scalpers, and eBay resellers. While eBay allows for anyone willing to buy the PS3 before Christmas at $2,800-$3,400 (the range I've observed), Sony is losing out on a lot of profits.

Can anyone offer any reason as to why the experts would set the price at $600?

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