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Sony's Stringer Pushes Back Against Kotick's 'Noise' On PS3 Pricing

As Sony faces mounting price pressure on the PS3, CEO Howard Stringer snaps back against Activision CEO Bobby Kotick's blunt criticisms of the console's $399 sticker with the assertion that the exec "likes to make a lot of noise."
Sony's been taking heat from all sides for the price of the PlayStation 3 in recent months. Comments from publishers and developers, retailers and analysts of both the professional and the armchair variety continue to suggest the PS3's $399 tag is prohibitive to the growth of install bases -- and calls for a price cut have only mounted now that E3 has come and gone with no hint that one is imminent. Just a few days ago, Tecmo Koei CEO Kenji Matsubara told CVG he'd like to ask Sony to "please cut the price," somewhat an unusual move for a Japanese publisher. But the boldest statements came last month from Activision CEO Bobby Kotick, whose blunt threat to withdraw support for the platform as soon as 2011 without a price cut was widely publicized in the consumer, trade and technology press alike. Now Sony's pushing back, it seems. "He likes to make a lot of noise," Sony Corp CEO Howard Stringer told Reuters of Kotick. "He's putting pressure on me and I'm putting pressure on him. That's the nature of business." And when Reuters asked Stringer about the logic of sustaining with no price cut, he was similarly direct: "I [would] lose money on every PlayStation I make -- how's that for logic." At the same time, SCEA president Jack Tretton's talking about the company's long-term strategy and the need for patience. Tretton said especially given the state of the economy, industry watchers and consumers are less willing to wait for long-term investments to take root, and that impatience with pricing and hardware growth is one of the challenges of being in the video game business. "People are always wanting you to lower your price on hardware," he tells FastCompany as part of a larger interview on the oft-discussed 10-year plan for the PlayStation 3 . "We could've come out with a PlayStation 2.5 for $299 or less, and in the first two or three years it would sell extremely well. But there would be a point where people would be going, 'I am not really seeing the incremental leap.'" "We feel that we're sacrificing the short term to pay dividends in the long term," he adds. "People are having short-term thinking--the platform is not even three years old. It was $599; it's now $399." He says Sony "appreciates" the concerns about the console's price, but believes their strategy is on the right track for the long haul to gain the consumer base it wants. "You won't get them all day one, but we're looking to get them over a 10-year period. It's going to take different things to get different consumers."

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