PS3 manufacturing cost down 70%

Sony have reduced the manufacturing cost of the PS3 by 70% according to Nobuyuki Oneda, Sony CEO and EVP: “The cost reduction since we introduced the PS3 is very substantial and this is on schedule. We don’t disclose how much of the PS3, specifically the cost deduction was achieved during the past two years.  But that is on schedule.” Pushed further he admitted:  “About 70%, roughly speaking,”

Obviously this gives Sony room for a price reduction and thus make the PS3 less uncompetitive.

The 70% reduction is nothing special here. Firstly Sony were forced to rip a lot out of the original machine, including hardware backwards compatibility, to reduce costs. Secondly Moores Law reduces semiconductor costs by half every two years. And thirdly the Bluray drive was new and expensive at PS3 launch, now it is a mass production part which must be costing them a tenth as much to make.

And the PS3 Slim is in production now.

2 comments ↓

#1 ADJB on 08.02.09 at 5:53 pm

“Secondly Moores Law reduces semiconductor costs by half every two years.”

The site you quote actually says :-

“Moore’s Law, states that the number of transistors on a chip will double about every two years.”

That doesn’t mean a halving of price, it means a potential doubling of power, far from being the same thing.

Sony won’t gain this advantage because the cell processor hasn’t doubled in transistors in the last two years, its stayed exactly the same. They may have had some cost reductions by increasing the yield per wafer but this won’t be anything like a 50% price drop.

Most of the cost reduction will be as you say from redesign and sorting out Blu-Ray production, not from chip price reductions.

#2 Bruce on 08.02.09 at 6:12 pm

As far as I know Cell started as a 90nm device. Then , via 65nm, it became the current 45nm device and is going to 32nm. Exactly as Moore’s law predicts.

So they are getting four times as many processors for the same size wafer as they were at the beginning. So a Cell now costs 25% of what it did originally. All other things being equal.

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