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"I support the PS3 as much as the next guy, but honestly. If you really look at the data and keep track of everything that happens. You'll know deep down that a PS3 pricedrop could be the final nail in a potential coffin for the playstation brand. If they sold more consoles at a even LARGER loss. The division could be cut off entirely, or worse. The company could go bankrupt. Now where would funds be to support a PS4? Where would funds be to add new and exciting things to PSN? Where would those funds be? They would be bled out."

Honestly, those problems are simple enough to solve. First of all, all Sony needs to do is issue a price drop when they can afford one. PS3 will be significantly cheaper to manufacture later this year thanks to the 45nm hardware revision coming this summer. At the very least the system should be breaking even at $399 at that point. Furthermore, lowering the cost of the system isn't necessarily a lose/lose situation for Sony. With a lower price point comes a larger market to which to sell retail and network games, Home accessories, peripherals and more. If Sony can manage to issue a huge price drop during a period where they would see the most profit from the increased software/peripherals, then they could probably minimize any increased losses by a hell of a lot. It just so happens that Q4 is the perfect opportunity for this with the releases of Uncharted 2, Ratchet & Clank Future 2, M.A.G, God of War III, and Gran Turismo 5 all happening in this period, all sending profit straight to Sony. Never before has PS3 had such a huge list of million selling 1st party games releasing during the same 6 month period. It's the prime opportunity and by the time that it's over, PS3 will be ready to have yet another hardware revision later on in the year to continue to bring the PS3 back into the black.

As far as their next system is concerned, I think Sony has really learned a lesson this generation. I sincerely doubt that Sony is going to release the PS4 at anywhere NEAR the loss they originally released the PS3 at. Honestly, I wouldn't be surprised if Sony finally took a lesson from Nintendo and released their system to make money from day one or at least close to it. That really solves Sony's problem of profitibility next gen, especially if they mostly use techonology that is already cheap and established by the PS3 such as blu-ray and the Cell processor.