Sony Want to put prices up.

I can't find the article at the moment, if I find it again I will edit it in here at a later date, but I read on it that Sony, in addition to shedding jobs and closing operations across the globe have hit upon a strategy to try and beat the credit crunch.

It seems they want to put UP prices of their products across the globe.

Now for the life of me, I can't figure this out. Surely if they put up their prices then they are going to sell far less units. Would you pay £800 for a Sony TV compared to a £700 other brand one of exactly the same spec and quality, especially given that just a week ago, the Sony TV was £700 also?

What about consoles? The PS3 has sold slowly mainly because it was so expensive. The Xbox has sold far more, even despite the problems that machine has had. By rising the price of the PS3 to me this means people will increasingly opt to buy the Xbox. Same goes for all other sony products... While they are a good make, I don't think the cash aware consumer will pay the extra when they have perfectly good alternatives at a cheaper price?

Am I wrong here? Am I missing something blindingly obvious or do I underestimate brand loyalty?

To me this makes no financial sense whatsoever and I think will end up costing Sony far more in the long run.

To be honest Tony I can't remember if it was just the UK or not... I can't find the article I originally read... I thought I'd bookmarked it but it appears not!

What you say about the falling value of the pound makes sense I suppose, but the knock on effect will still be the same I feel as the value of the pound against the Yen or the Dollar is not really relevant when you choose which console to buy. It all comes down to cost and quality. I do not doubt the PS3's quality (which I love) or indeed any of the other Sony products, but if other products are available of a similar quality at a lower price I think they will be the one people buy and that can only be to Sony's detriment.

I have a similar argument with the ticket for football games. I wonder if charging £13-£15 to see a Div 1 team and getting 2-3000 paying spectators each week (minus season ticket holders and travelling fans) is more cost effective than charging £7.50 and perhaps getting double the amount of fans?

I'm no expert on market forces or finance as you can readily see, but I don't see how putting prices up in the current climate will improve things for the company or the consumer.

(EDIT : I still can't find the original link for this story, all the ones I find link to sources I would not trust... As soon as I find it I will post it).

A little addendum to this :

Sony have now revealed that they have slashed 35% off the actual production costs of the PS3.

Experts are now predicting, given that the PS3 has been summarily outsold all year long by the Nintendo Wii and the Xbox 360, that the price of the PS3 may well fall in 2009 in an effort to boost sales.

There are no details as yet of what the cut is and Sony are so far denying this (As they would do, as nobody is likely to buy a PS3 for £300 now, if they are going to be £200 in two months time) but it seems plausible if not contradictory to the claims they were making previously.

That's another good point which I hadn't thought of. I know Blu-Ray players have not sold anywhere near as many units as the manufacturers had hoped for over the past 12 months. It seems to me that reducing the price of the PS3 would also dramatically improve the chances of Blu Ray taking off this coming year. It's a wonder that the major blu ray manufacturers have not moved to perhaps subsidise a cost cut on the PS3. I think most people would baulk at paying £250 for a Blu Ray player, but would perhaps be more inclined to pay £250 for a PS3 that is also a Blu ray player.