exactly

 "starting to", and it's because of massive software sales :( I'm not sure if the 360's hardware sales alone could account for the billion dollar writeoff, let alone scratch the debt collected by the first :/ MS has some GREAT selling software, and I see them understanding this, they hire a studio to make a game, pump the shit out of it with advertising, and let it fly to no end :P They are absolutely brilliant with software, which is why I just don't see them making another console, it just doesn't add up to me lol. 

IF the games division does not turn a NET profit this entire generation, then you can expect their next console to be the make or break for them in the console market.

Remember, Sony is a corporation owned by investors, and even if the company is making money as a whole, investors wont be happy if a division is sucking away at their dividends.

However, they will not abandon the division simply because of one failed console (if it does fail over all, and by fail I mean lose the company money in the long run, which I doubt highly it will)

Worst case scenario, PS3 never makes a net profit, PS4 never makes net profit, 10+ years of net loss may spell the end of their console hardware entries. But the chances are so slim of this happening at all, and the data so incomplete that it is impossible to determine if that is even a possibility.

When comparing to Nintendo, always remember, Nintendo has ALWAYS made money on their consoles, and their business is ONLY games.

Sales != Success, its all about profit.

@noobie

DMC4 360: 400k
DMC4 PS3: 470k

actually ps3 version is doing better than 360 version by a lead of 7k

this is way pointless to discuss, sony isn't going anywhere just cause one console is last place for now.

so technically, your statement is actually false.

 I predict a great future for you in the Tarot card business, other business adventures might be less fortunate.

I m sure XBOX version of DMC will sell more copies on than PS3 version... why cuz if u have a done a little analysis u would have seen that XBOX version outsold PS3 version in 2 of the three markets... and Japenese market is not large enough to give enough boost to PS3 through its entire life... already they have sold like less than 20% of the first week... and i m sure the fall of shipment in America will be much less and so in the end XBOX will win.

It will be much worst case in GTA4... where i m not sure if Japanese market will even matter.... so wot have PS3 got... they r winning in Europe only and that just usually like 10k - 15k.. (i m talking abt after the adjustments)... and why everybody keep forgetting that they r already in a deficiet of over 7 million for the second place...

So attract the game studios they have show the install base... or they have to give them the money.... so far they don't have the isntall base big enough to attract the studios for exclusive and without exclusives i m not sure they r going to win this battle.. and they r resistant to give the money to keep the exclusives...

So its not that they have life to cross XBOX... XBOX continue to win till the mid of 2009 then in my view MS has won.... cuz i m sure they will be bringing out new console by the end of the 2010 and then wot SONY will be doing... will SONY continue to fight with its last gen console against the next gen console from MS till 2011 to fullfill the research and development cost.? or will they also rush out to bring the console without recouping all the lost money on the PS3... big dilemma in my point of view for SONY... and remember then there will be even more exclusives for XBOX... thats why i said its going to be the last gaming console for SONY

My god you are lame ... seriously , when did 360 fans get so desperate ?

 I hope that I never have to make this correction again, but Microsoft is a 100% debt free company. Microsoft is 100% financed via equity financing. On top of that, Microsoft has about 50 billion dollars of spare cash on hand at all times. 

And as far as Microsoft's problem with hardware, lets not forget that Microsoft is a software company first. It is not too surpising that sony is capable of manufacturing a more reliable counsole. Sony's primary specialty is hardware. Give Microsoft time...I am sure this will be one of the biggest issues addressed with the next X-box (reliability). The RROD issue is still unjustifiable; however, they will learn from their mistake.

But please posters, stop stating that Microsoft is in debt. It really diminishes your credibility.

One last time, MICROSOFT IS A ZERO DEBT COMPANY.  

your sure DMC4 will sell better but all we have is data and its a fact that DMC sold better on ps3 its first week.

after GTA sells millions on BOTH consoles the ps3 will STILL be selling better WW the 360........

if they make a new console they would be stupid and 3rd parties will hate them because no one is use to the high prices of making games now so u think microsft is stupid enough to make a console thats double the prices of devs now? thats a stupid move and if they do that will be microsofts LAST CONSOLE.....

I'm no finacial advisor, but how did they write off the 4 billion dollars of hardware manufacturing costs with the original xbox >_>? And yes they have billions of dollars sitting around, which they're currently trying to throw at Yahoo.

And I agree with you, they are good at software, not so much with the hardware, the reasons why MS didn't just buy out more software developers is beyond me, they make soooo much money on it, but the hardware does nothing but lose them money.

Also note, by "Dept" I'm referring to their gaming devision >_>; not the company as a whole.