Is Sony really losing that much MORE money on the PS3 after price cuts?

[Noobie]

i did a little research on it and i find that probably they r losing in the range of 25 - 50 per console and by the March they might have another US$ 50 off while still managing to break even with the console.

Actuall iSupply Data was used in the original analysis and they estimated the cost for the July - August period for the first batch of PS3.
Link for the original article
http://www.isuppli.com/news/default.asp?id=6919

I will be estimating the cost for current October period. So it will make it like 15 months difference..
Component ---------- Original Price - - - - - - - My Current estimate
Nvidia RS - - - - - - - 129 - - - - - - - 80
(original estimate in my view was high due to the low yield but with supposedly better yield after 15 months and adding 20% cost reduction after 15 months i think it should be less than 80)
Cell Proc - - - - - - - 89 - - - - - - - 45
(original was for 90 nm... Sony updated the processor to 65nm, so price cuts by half whenever there is die shrink.. normal fabrication rule i would say)
I/O Bridge - - - - - 59 - - - - - - - 40
(straight 20% price reduction over 15 months plus u have remember that sony removed Emotion Engine and GC for backward compatibility which must have reduced circuit complexit.)
EE & BC - - - - - -- 27 - - - - - - - 0 (not present in 40 GB model)
XDR Mem - - - - -- 48 - - - - - - - 40
Other - - - - - - - 148 - - - - - - - 120
Blue T - - - - - - - 4.10 - - - - - - 4.
802.11 - - - - - - 15.50 - - - - - - - 12.00
Other - - - - - - - 2.5 - - - - - - - 2.0
Mem Card - - - - 5.0 - - - - - - - 4.0
BR Diode - - - - - 125 - - - - - - - 20
(Sony officially stated that they have increased the production and reduce the cost substantially which i think is right as we are seeing BR players for less than 250 from more than 1 Manufacture.. so the diode is one small part of the player and i m sure it should not be more than 20 at any cost for Sony)
HDD - - - - - - - 54 - - - - - - - 35
PSU - - - - - - - 37 - - - - - - - 25
(the new SKU i think has a smaller PSU as the power requirement has come down in 40 GB model)
CMM - - - - - - 22 - - - - - - - 15
(lesser heat has reduced much stress on cooling)
EH - - - - - - - 31 - - - - - - - 25
Misc - - - - - - 1.75 - - - - - - 1.5
MC - - - - - - - 40 - - - - - - - 35


Total - - - - - 840 - - - - - - - 503.5

Take these number with huge amount of salt..:)

But i will like to clearify few things...

Sony went with the reduction of Cell processor from 90nm to 65nm instead of the Nvidia graphics minitiarization and if we apply common sense this means that the cost of Cell was higher than the Cost of Nvidia graphics... other reason could be that initially Nvidia graphics initially had a very high rate of defect which was the reason for high cost cuz i don;t think that 7900 GT equivalent chipset should be this expensive when 7900 GT card is for around $120... so i think they have the cost down to around US 50.

Blu Ray Diode price could be higher than 20 but i personally read somewhere that they have got it to around 8... but i don't find that source again but if u read the following link they have mentioned that by reducing the cost of Blu ray they r expecting at a direct $100 reduction...

http://arstechnica.com/news.ars/post/20070615-sony-ps3-a-price-cut-candidate-perhaps-by-christmas-sony-ceo.html

But it could be off.

i don;t find motherboard in the iSupply data, they either have it included in the I/O or in the other cost... but by removing the Backward Compatibility Sony must have saved more than US $50 else i don;t think they would have gone with the chopping of Backward Compatability as it is one of the thing they have always claimed heavily.. So the cost must have to justify it.. So i have removed 27 from the EE & BC but some $10 from I/O.. but i think they could have save quite a bit in Other cost also by removed this Backward Comatibility.

Lastly i think for the first 15 months 20% reduction is a bit consertive as initially the defects r high, So the reduction in price comes at much higher pace initially but after 2 years it sort of levelled off. So i won;t be surprised if in some components like RAM and I/O component they have managed to save more... cuz i don;t think after 2 years they will be reducing much cost on these components..

Once again its a rough estimate but i have tried to be as objective and logical as possible...

And one last request can we just stop having this argument that Sony reduced the Price by $200 or $100... Sony initial price was $499 and $599 and now it stands at $399 and $499... i think that look a lot more objective and logical to me... u want to call it $200 price drop its ok with me.. but if my maths doesn't agree with yours then leave it... i think let it remains as a paradox of Maths for the future generation that how it is $200 price drop or $100 price drop. :)