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It's sort of unrelated but I wonder how much effect the model shuffling has had. All of the people I know who have bought PS3's since the 60GB was discontinued have bought used 60GB units off Ebay - even people who don't have any PS2 games.

I can put myself forth as an example. I got the 60GB because it has full hardware BC. The number of PS2 games I have: zero. So why do I care about full BC? Because I like to know it's there, I guess. It's sort of the same reason that people buy cars that can go 120 when there's nowhere they can drive it over 80. It's not a rational decision but it's the decision I made, and I doubt I'm the only one. You just feel like you're getting a lower-end product when you get the new PS3, and if you're spending that kind of money for such a thing you want the "best".

As for people that actually have a significant library of PS2 games, the "just keep your PS2" argument doesn't fly. It requires another input, doesn't upscale, you have to have another console and set of controllers laying around, etc. It's the same reason I play NES games on an emulator even though I have an actual NES sitting in my closet somewhere.

So, I'd say that they should at least offer a low-end system (which they have with the 40GB) and a high-end system, even if they have to make it a little more expensive to keep full hardware BC - people buying the high end system don't want to make compromises. You could even add more to the price of the high-end system to "subsidize" the low-end system. So, you'd end up with say, a $349 40GB with no BC and a $549 80GB with full hardware BC.