What massive amount of debt?. AndSony will be making a profit on the hardware about June of this year.

Sony debt = $11.36 billion, Cash on hand = $4.28 billion, Operating profit = $1.05 billion. That massive amount of debt. At least it's massive compared to Microsoft's debt = $0, Cash on hand = $26.4 billion, Operating proft = $11 billion and Nintendo's 0 debt with over $10 billion in cash on hand and probably $2 billion in profits (Nintendo has a more opaque financial report). I doubt Sony's ability to cut $200 in cost in just 7 months and haven't seen anything that indicates they can do it but stranger things have happened.http://finance.yahoo.com/q/ks?s=SNEhttp://finance.yahoo.com/q/ks?s=MSFT

I am a little bit sceptical about that hardware will turn to profit as early as June. Reason for this is that I work with cost reduction in the car industry, and it takes time. Testes should be done ect. More cost reduction actuly cost money, working hours and those test as I mention before. So why work with it? Because with high volumes a save of 1 € becomes a lot of money, the problem is that Sony for the moment doesn't have those volumes. I don't doubt for a second that Sony will cost reduce PS3 a lot, and some cost will go down simple because of the initial plans are done. But to get a profit on the hardware as early as June is for me a bit optimistic.

Even if hardware does turn a profit, you still have to recover R&D and marketing costs.

no SONY's total debt is just 1+ billion dollars Total Debt 1,364,666 http://stocks.us.reuters.com/stocks/balanceSheet.asp?symbol=6758.T&WTmodLOC=R4-Financials-2-Balance $11.36 billion is the total liabilities(short and long term) +Shareholder's equity .....It is not the debt total assets = total liabilities + total shareholder's equity. (this is often referred as debt under accounting terms). as for long time liabilities ---they also include pension plans + other fringe benefits which are accrued over a long time period. Those are not debts. Total Equity 3,459,801 is what you have paid to shareholders or wd be paying at the end of the year. SONY's total current liquid assets is around 2.5 billion which is more than enough to pay the accrued debt. Total Common Shares Outstanding 1,001 .....when these are issued SONY wd make a huge amount of money as well. shareholders own 49% of SONY,MS and NINTENDO. you are actually messing up debt with SHAREHOLDER'S EQUITY and LONG TERM ACCRUED EXPENSES,retained earnings etc

Whoa Baxter, be a bit more careful with what you're accusing people of confusing, just as I should have been a bit more careful with Yahoo's finance report. Yahoo Finance is a bit more simplistic than Reuters so those liabilities are listed under total debt which yes means various different things other than "debt" per se. The term liabilities would probably have been a better one to use. Semantics aside, whatever their various sources, Sony owes a lot more money versus their money on hand and money coming in than either Microsoft or Nintendo. Edit: Quite embarrassing, we both ignored the "millions of Yen" not "thousands of dollars". I should clarify that despite the apparent banning, at least for Jasper's sake. At 116 Yen/Dollar Sony's debt is $11.6 billion and other liabilities (long and short) are a staggering $73.1 billion compared with MS and Nintendo having 0 debt and liabilities of almost $30 billion for MS and $4 billion for Nintendo. Not only that but Sony's debt has increased from $9 billion in just one year. Again the point remains that Sony is not in as good a financial position to fight a price war, most especially since it is making the biggest loss per system.

While on the price cut theme, retailers are taking it upon themselves to deliver the price cuts of the PS3...

From BIG LINK! I suspect the shops are starting to maybe do bundles which appears to make systems cheaper? EDIT* Sorry it seems that report is rubbish Site In Report

The going rate on eBay seems to be around £380, so that I'd guess that is probably be pretty close to the wholesale price.

Spot-on. It's a mega game of smoke and mirrors in Europe at the mo with BS flying around everywhere. As you say, it'll take a couple of months for it to settle down and at which point I expect Sony to have to cut the PS3 price by at least 10% to start shifting units regardless of whether MS cut the 360 or not (tho I expect they will too). Sony need to be seen to be shifting significant amounts of units THIS YEAR otherwise games that should be kicking off now in time for Xmas 2008 are in jeopardy ... The most interesting thing recently is seeing MS put that big price up for the Elite. I think they are feeling very, very confident at the moment ...

[quote]That Guy said: Is anyone counting Sony out? No, not yet. Next holiday season might be a different ball game, but for this past holiday season, the Sony fanboys should gracefully accept defeat. quote]undefined Um there are a few morons on these boards and others I've seen that are definetly calling this over for Sony. I'm no Sony fanboy, but console races are long drawn out cycles. To me it's very hard to predict how the PS3 will due long term because we've never had the most dominant name in video games put out an expensive and very technolically heavy system system like the PS3. Obviously price cuts will be important, but at most I see a $50 price cut this year. Sony will accept third place for the forseable future, hope it closes the gap in monthly sales between the other two, and probably try to make a killing in 2008 with more major price cuts, and hyped up marketing over a lineup that will probably be mcuh better than what we get in 2007.