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Phil Harrison on how the PS1 price was decided

PlayStation
(Image credit: Future)

Phil Harrison, the director of Product Development at Sony Electronic Publishing during the PlayStation launch, has revealed how the price of the console was decided the night before an E3 event.

Speaking to Edge as part of the Edge Game Changers series - a look back on some of the defining moments of previous console launches - the magazine spoke to Harrison, who is now a Vice President at Google. 

Reflecting on the 1995 E3 where Sony announced the price of the PlayStation as $299, Harrison says "It was the opening event of E3, but the real discussion took place the night before in a hotel room where we all sat around and planned what the price was going to be. It involved a lot of very, very last-minute and very... I don't think some of our Japanese colleagues slept that night. I think they spent most of the time on the phone and sending faxes back and forth with Tokyo, just to make sure that it was possible to do what we were planning."

The thinking behind the aggressive price for the time was, in Harrison's words to "set us up well for the launch in the US and in Europe". PlayStation had made a good start in Japan, but knew going up against Sega and Nintendo would be a tough environment to launch a console into. However, that E3 helped cement PlayStation's place in history, not only due to the mic-drop moment of its price reveal, but the announcement of Final Fantasy 7, which was a "was a huge factor in the success of PlayStation in Japan", according to Harrison. 

The former director at Sony also spoke about the economics of console making, telling Edge that: “It's slightly misunderstood that console companies always make a loss on the hardware. That is not true. It is true that when the PlayStation was launched in Japan at ¥39,800, the equivalent of $400, we were losing money on every single machine, mainly because of the sunk R&D costs that had gone into its design and development up to that point." 

"However, wind the clock forward a few years, we're selling PlayStations for $99 and we're making money because the machine is now cheap enough to make and has been cost-engineered down to the point where it is a profitable piece of hardware, irrespective of how many games you sell."

Make sure to head back to GamesRadar this week as we delve into the stories behind the console launches with the key figures who witnessed them first hand. 

Hello, I'm GamesRadar's News Editor. When I'm not moaning about being beaten on FIFA, I'm writing news and features for this wonderful site.