Please ensure Javascript is enabled for purposes of website accessibility

Sony's PS3 Clearance Sale

By Alyce Lomax – Updated Nov 14, 2016 at 11:42PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Sony's PS3 price cut may not be quite what it seems.

Sony (NYSE:SNE) may be in hot water with consumers yet again. It turns out that the company's recent price cut on the 60 GB PlayStation 3 wasn't the whole story -- Sony apparently plans to phase out the model entirely. Call it a clearance sale.

If you recall, Sony announced last week that it would cutting the price on its 60 GB PS3, shortly after a high-ranking company executive said a price cut was not planned. However, phasing out the model entirely, leaving only the 80 GB model available at $599, seems a little different than cutting sticker-shocked consumers a break.

Sony and Microsoft (NASDAQ:MSFT) are duking it out for hardcore gamers, with their respective PS3 and Xbox 360 consoles offering many whiz-bang features that make them a neat addition to the modern living room. However, Nintendo's Wii has made it clear that a lot of consumers are reacting very well to a low-priced, simple alternative in video games. PS3 prices have long been criticized as nosebleed-inducingly high, but now Sony seems to be pushing a "Get it while it's hot and cheaper!" angle to drive sales of the 60 GB model.  

Several of Sony's moves over the last couple of years haven't exactly engendered consumers' goodwill. Rootkits, fake blogs -- is this the right way to treat customers? The Financial Times reported that Sony's phaseout resulted in consumer rants on gaming sites.

Can the short-lived discount possibly be good for the Sony brand? In another interesting note this week, Sony lost its top spot on a Harris Interactive consumer brand survey to Coca-Cola (NYSE:KO), after seven straight years at No. 1. Then again, Sony shareholders might take some comfort in knowing that it's still holding on at No. 2, despite its many recent consumer-galling mistakes.

CNET sought out Sony's side of the story. The company said that there's still plenty of the 60 GB models around, and it didn't rule out the idea of a later price cut on the higher-end version, once it evaluates the market.

Still, Sony shareholders, or anybody who's considering the stock, should think long and hard about its recent PR blunders. In addition to suggesting serious strategy confusion at Sony, their effect on consumers' opinions of the company's motives shouldn't be ignored.

Keep the game going with this Foolish content:

Microsoft and Coke are Motley Fool Inside Value recommendations. Nintendo is a Motley Fool Stock Advisor pick. CNET is a Motley Fool Rule Breakers selection. A free 30-day trial to any of these newsletters will boost your portfolio.

Alyce Lomax does not own shares of any of the companies mentioned. The Motley Fool has a disclosure policy that appeals to all gamers alike.

None

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Sony Corporation Stock Quote
Sony Corporation
SONY
$68.43 (-1.37%) $0.95
Microsoft Corporation Stock Quote
Microsoft Corporation
MSFT
$237.92 (-1.27%) $-3.06
The Coca-Cola Company Stock Quote
The Coca-Cola Company
KO
$58.60 (-1.11%) $0.66

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
339%
 
S&P 500 Returns
109%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 09/24/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.