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The rumors speak of it unfortunately its a shadow on the entire discussion. By the time it rears its head in a thread the discussion is almost at an end. The boosters have long since vanished having filled the first page with unending enthusiasm, but the question still remains. What would it mean for a PS3 to actually not be backwards compatible. How would that affect sales, and public perception. How would that affect the PS2 and its developers what would happen to them.

For those ignorant of what I am talking about the rumor is that the new 40 gigabyte PS3 will not support any backward compatibility.  This applies to both hardware and software emulation. Were you to buy this machine you would not be able to play a PS2 game on it period. Thus no backwards compatibility.This would be a physical limitation within the machine itself. 

I am not sure I believe the rumor. Any part of it for that matter. This thread is just to discuss what the implications of removing backward compatibility in any sku of the PS3 would be. This thread is not about the price, the size, the free movie, or the holiday season. This thread is solely dedicated to the question of backwards compatibility. Please keep it that way. Try to focus on the one aspect. There are enough threads that discuss the others.