Sony Confirms Development of PS4, Cuts PlayStation Development Budget

Sony Cuts Investment Costs for PlayStation 4 Game Console

by Anton Shilov
05/26/2011 | 07:12 PM

Sony Corp. has confirmed that it had initiated development of the next-generation PlayStation video game console. At the same time, the company admitted that due to global economic crisis along with its own business problems, it would not invest the same amounts of money into the PlayStation 4 as it did in case of the PS3.


"The PS3 still has product life, but this is a platform business. So for the future [of the] platform, when will we introduce it? What product? I cannot discuss that. But development work is already underway," said Masaru Kato, chief financial officer of Sony, at a meeting with investors noting that part of the FY2012's (began on March 31, 2011) R&D budget would be spent on the PS4, reports Gamasutra web-site.

Sony invested tremendous amounts of money into PlayStation 3 game consoles, which is currently still the worst-selling system in the current generation behind Nintendo Wii and Microsoft Xbox 360. In particular, the consumer electronics giant co-developed Cell heterogeneous multi-core microprocessor with IBM and Toshiba and invested into chip manufacturing facilities, developed Blu-ray disc standard and spent money on BD replication plants, created a number of other technologies. Sony had been losing money on all PS3 consoles it sold for years after the introduction in 2006.

But that is not something that is going to happen to the PlayStation 4. The company is going to try to cut research & development as well as manufacturing costs. Partly, those expenditures should be reduced because the firm no longer plans to make major chips itself using proprietary manufacturing processes on its own fabs. In addition, the firm does not seem to have plans to create a new microprocessor for the console from scratch.

"This is something that will not happen in the future. The semiconductor business is changing. It is no longer thinkable to have a huge initial financial investment like that of the PS3," said Mr. Kato, reports Andriasang web-site.

Rumours that Sony had initiated work on the PlayStation 4 have been floating around for over a year now. At present, capabilities of the console are unclear, but the targets have probably already been set.