Predict the effect of the 360 price drop. Will it be outsell PS3 again?

[NJ5]

It's more conceivable that they could drop the price quicker/bigger than the 360 which is essentially based off of existing PC technology.

The 360 is not based on PC technology. Maybe you're mixing it up with the Xbox?

Look at Blu Ray players, started at $1,000 and are now down to $300.  Without a detailed analysis of actual costs of each machine, which I doubt you have it's your opinion compared to mine.

It's not my opinion that they're losing a lot of money on PS3 hardware, it's Sony's:

"our cost of the hardware is much higher than the price itself"

You said they have promised not to cut the price of the PS3 to the board member.  I don't see that in the article you posted.

"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.""

"to increase the software rather than drastically increase the quantity by adjusting the prices"

"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."

Read these declarations, it doesn't get much clear than that. They're telling investors that they're concentrating on profitability and selling software, not hardware price reductions. This would explain their hardware sales forecast, which is not ambitious.

Do you think they'd risk having an unprofitable / break-even holiday quarter 2 years after PS3's launch? That would make the games division look like a pure money sink, since that's supposed to be the biggest quarter. Investors wouldn't be happy at all, especially considering Sony's falling profits.

All the signs point towards no price reductions this year. I've made up my mind, and I've given you all the information you can use to make up yours. I'm not out to convince you, so let's just let it rest :)

If they don't drop the price now they will gain no effect from a price drop until the 4th quarter of next year.

Not true, any price cut will help throughout the year. And how much do you really think a $50 price cut could help them in the holidays? I think they're just going to make some attractive bundles, and call it a day.