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Warlord_ said:

But i still think it will outsell the wii over its lifetime, the wii will die off and the PS3 will get cheaper and sell more.

I can't understand the notion that the Wii will die off. It doesn't make any sense -- many of the people buying the Wii now would be just as likely to buy it in 5 years. Wishful thinking, perhaps, but it just looks foolish.

The PS3 started life at twice the price of the PS2 and more than twice the cost. The PS3 will likely never approach the cost that the PS2 attained at this point while it's still being sold. Technology gets cheaper, but it is within limits. It still costs a lot to run fabrication plants, etc. Sony's hope is that the Cell will become popular for imbedded applications and in many other areas so that fabrication costs are significantly lower for them. This is a longshot.  There already exist cheaper, better processors for most embedded applications.  And there already exist cheaper ways to generate a lot more floating point power than the Cell.

The PS3 is simply a more expensive architecture than the PS2. The PS2 didn't even come with spinning storage. Perhaps the PS3 will drop to $250 or maybe even $200 by it's 6th or 7th year on the market, when it is obsolete and everyone is clamoring about the PS4.

This brings me to an interesting observation: if Sony decides to get their costs out of the stratosphere when engineering the PS4 (a very likely scenario) and the PS3's costs still haven't come down to earth, it is possible that the newer, faster, better console would cost approximately the same to manufacture as the older one. Making one wonder how it would last ten years in the market.