In an investor note issued Friday, Pachter said he expects a 12 percent year-on-year increase to $445 million for August videogame software sales.

“We expect August to be up ‘only’ 12 percent, due to tough comparison with last year,” he stated.

NPD Group's official August US videogame sales figures are slated to release on September 13.

EA will command top third party sales in August, according to Pachter, with an expected $135 million in sales (an 11 percent year-on-year decrease) thanks mainly to Madden NFL 08, which is flanked by Tiger Woods PGA Tour 08 and Boogie.

While this year’s Madden has undoubtedly sold piles of copies, Pachter cited “pessimistic” investors who are wary of the title’s performance, as EA has yet to issue a “self congratulatory press release” about Madden 08’s performance. Shortly after the release of last year’s Madden, EA announced the game had broken franchise records with 2 million copies sold in its first week.

Another notable August release was the Xbox 360 and PC game BioShock from Take-Two. Pachter believes the critical darling sold 600,000 units at retail, driving the publisher's sales to $60 million for the month, a 221 percent year-over-year increase.

Other anticipated big August sales contributors were Metroid Prime 3: Corruption, Guitar Hero Encore: Rocks the 80s, Guitar Hero II and Wii Play.

Hardware

In August, Microsoft dropped the price of all three Xbox 360 SKUs: Core to $279 from $299, Premium to $349 from $399, and Elite to $449 from $479). The cut followed a price reduction on the 60GB PS3 in July from $599 to $499.

Pachter thinks that the Xbox 360 price cut is enough to significantly drive up software and hardware sales relative to prior months. For August, he expects Xbox 360 hardware sales of 240,000, up from July’s NPD-reported 170,000.

He expects the PS3 will actually sell less than the previous month, predicting 150,000 units for August versus July’s 159,000.

Wii sales are expected to remain strong as supply constraints are alleviated with 420,000, and handheld sibling DS with 400,000. "It appears that the supply situation for the Wii has improved, with weekly sales averaging 106,000 in July following an average of only 81,000 for the prior 26 weeks," he said.

PSP is forecasted to sell 210,000, PS2 to sell 225,000 and GBA with 75,000.

Pachter said that a price cut for PS2 or DS is possible by year-end.

The analyst has stated in the past that he believes that the $599 80GB PS3 (currently packed with MotorStorm) will be available for $499 once the 60-gigger is out of stock. But now he expects another PS3 price cut “no later than April” of 2008 to $399 for the 80GB version.

He stated, “We think that Sony’s recent announcement of an IPO for its financial services unit (with an estimated $3 billion in proceeds) could forebode another PS3 price cut early next year. We believe that the company is interested in subsidizing sales of the console in order to stabilize its market share in the games market and grow its lead in the high-definition DVD market.”

http://www.next-gen.biz/index.php?option=com_content&task=view&id=7092&Itemid=2

I was just about to post this story, but I thought Sony was the first to make the move to lower its price of the 60GB and then the coming weeks Microsoft then lower its price on its systems.

Wow this is not good for Sony. Now Sony will be suffering even more financially (in b4 Sony is actually making a profit arguments). They must be really desperate to move units.

If they keep cutting prices, when is Sony going to make a profit? 2009?

And when will they dig themselves out of all billions in losses? 2015?

Sony could (hypothetically speaking) be looking to gain liquid assets for a large number of reasons ...

I was emailed an article from a financial analyst the other day who was encouraging investors to get out of investments where the company was heavily involved in big-ticket luxury items. The analysis was (fairly) straight forward and what he was suggesting was that the dropping of housing values across North America combined with more difficult to access credit was going to reverse the trend of people taking out home equity loans to buy big ticket luxury items; his expectation was that most of these companies were going to face dramatically lower profits in 2008.

Now, consider what Sony produces? That's right, primarily big ticket luxury items. Hypothetically speaking, Sony could be looking to have cash on hand to ensure that their electronics division has the necessary funding to keep operating when it is losing more money.

(Please note, this is just one of 100,000,000 theories of what could be happening)

doesn't that analysis suggest that big-ticket luxury items are going to suffer, not shine?

Sony needs to crush HD-DVD. This drastic price cut could be the key to doing this. Sony doesn't want to keep HD-DVD alive at all, even if Blu-ray is doing good profit-wise. And yeah, the PS3 really is the biggest competitive advantage that Sony has for the format war, but so what?

The problem is that neither HD media is really taking off.

http://arstechnica.com/news.ars/post/20070906-battle-between-blu-ray-and-hd-dvd-fizzles-as-consumers-watch-and-wait.html 

 actually they can cut production costs greatly, they only lose like $60 on the 80GB right now without including Motorstorm in the package. 

 I dont think they have moved the RSX and Cell to 65nm yet which once that happens costs will drop another 100 - 150 dollars easily.