Honestly what was Sony thinking

[Ratz]

I think that Sony was hit by a perfect storm. Three things happened all at once that hurt them:

1) Unexpected delays and high costs due to the BR drive and Cell processor of the PS3;

2) Strong competition with two products offering new things: Wii for the casual gamers + the Wiimote and the XBox360 fighting for the hardcore market and offering online gaming;

3) The economic crisis and loss of the value of the euro and dollar against the yen: the profits from sales in Europe and US will be lower and in times of crisis, the tendency is to cut costs first on the more expensive things.


These three things put Sony were they are now. There is nothing they could have done about #3 but #1 and #2 are valuable lessons.

Innovate on the next gen, instead of just upgrading the console (sorry but BR and wifi are not innovations) and don't try to build a too high end machine since you will suffer a big loss if someone undercut your price.