is 360 price cut even relevant?

[jarrod]

ramses01 said:

Attoyou said:

 

NEW Report Says They are Only losing $18, Google it if you have not already seen it , They are getting the price of the ps3 down Every month ,  THEY CAN And if They WANT Will Cut the Price , We will have to wait and see .

Even if the $18 is correct, that doesn't mean they are losing $18 per console.  It means that material cost of the console is $18 higher the MSRP. Sony's loss is much greater than that as each consoles also has retailer margin, shipping, and FTE costs associated with it.  Using your $18 as the base.  Then Sony is probably losing 18 + 15-30 for retailer margin + 3-5 for shipping + FTE costs (maybe $5-10) 

$18 per console would only be correct if the $349 SKU didn't exist.  That's PlayStation University's fuzzy math at work, the original source says "six cents loss on the dollar for hardware".