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cleveland124 on 03 August 2008
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NJ5 said:
 

No price cut before 2009. It's pretty clear.

Here is what Sony said to investors:

SINGAPORE -(Dow Jones)- Sony Corp. (SNE) Chief Financial Officer Nobuyuki Oneda said Friday the company has no plan to reduce the price of its Playstation 3 game console.

"Our strategy is not to sell more quantity for PS3 but to concentrate on profitability," Oneda told investors at a Nomura Asia Equity forum in Singapore. "Our plan is not to reduce the price."

Source.

Furthermore, they said they only expect to achieve profitability towards the end of the current fiscal year (i.e. close to March next year). Emphasis mine:

The minimum, I mean, at least over 10 million units has to be sold to create a platform. So therefore fiscal '07 even though that our cost of the hardware is much higher than the price itself, we have to sell close to the 10 million sets in fiscal year '07, but this year, our strategy is that we should focus more Internet-related service operation to increase the... to increase the internet operation, to increase the software rather than drastically increase the quantity by adjusting the prices. If you consider the long life, long lasting lifetime of the PS3, this year we don't think it is a time to aggressively sell the hardware quantity this year. That's our strategy for this fiscal year.

Source.

Sony's investors are not going to put up with more big PS3 losses.

 Key word is plan.  No plan for a price drop.  Which means that they would not initiate a price war with Microsoft.  However, having one initiated, I believe they will respond with their own $50 drop.  I think they'll wait to November to see how well the Microsoft cut works and then drop the price right before the holidays to come through as more of the bargain for Christmas.  Also, http://news.softpedia.com/news/PlayStation-3-Drives-the-Sony-Games-Division-to-Profit-91041.shtml Sony Games division was profitable for the quarter ending June 30th.  If Microsoft can afford this cut on their small profits for this year, I don't see why Sony can't. 

You'll also be hard pressed to ever find a management team that will hint at a price drop before it occurs.  They'll either say this that they have no PLANS for a price drop or they believe they have effected priced their product to the market.  Because when they hint their is a pending price drop current sales become stagnated and then a price drop becomes a necessity.

Yes but Remember that 75 percent of the units sold at $199 or less in the last generation.

Yes, but the US economy is much worse than it was ever in the last generation of games.  I think you'll still see people not purchase the 360 at $199.  Additionally, we've never had a unit as gimped as the core unit on the market.  Yes, I know you can add a hard drive and come out better than the pro/elite, but the casual market they are aiming for with the core is likely to be turned off by needing to pay for more items and adding the harddrive.  Most likely people that were waiting for the pro/elite to drop will buy this and add a harddrive.