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CaptDS9E said:
People seem to forget one thing. Sony does not want to be "even" with the 360. They need to be selling more then the 360 at a steady stream for a while to catch up in numbers in the US, and in other areas being outsold is not great position either. Sony was the last generation leader by a TON. They made huge $$ because game sales on their console was gangbusters. GTA came out, everyone bought it on the Playstation, same for Tekken, DMC, Guitar Hero, etc. A percentage of each went to sony from those sales. When they look at the numbers, and see at least 50% of those sales on their competitors platform its gotta hurt the bottom line.

 

They dropped the price because jasper chipsets are cheaper to make than falcon.

Also if there barely making money on hardware(there probaly losing a little) software, xbl(14 million membersx5 bucks a month), and xbox originals/arcade clearly make up for it.