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With 18 million sold in 2 years, I think Sony Computer Entertainment could be profitable if they keep the price where it is. PS3 would end up a distant third, and Sony might have to cut some employees....

Actually that's one scary thing for Sony: if I remember correctly they have something like twice as many employees in game development as Nintendo...so actually GameCube or even N64-like unit sales may not be enough to support that massive team.

Still, I think they have a better chance at surviving by leaving the price as is and accepting a big loss. Some will point to the cost to the Playstation brand, but I think the damage has already been done...and PS3 and PSP have proven (just like N64) that brand isn't that valuable anyway.