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Sony might be losing money on the Ps3 and on Blu-Ray but last I heard Blu Ray drives and laser diodes costs were on the decrease. Plus, if Blu-Ray becomes the standard, they wil get alot of money from licensing and manufacturing, not to mention rising sales of the psp and the ps2 (still selling). I am sure sales can help offset financial loses caused by Blu-Ray. At the end, When Blu-Ray wins they will probably gain much more money than they lost.