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KruzeS said:
The PS3 is far from dead. Japan might be a nightmare now, but it will save the PS3. It's quite simple really, success is relative. The 360 is doing OK there (success is relative, again), but it'll be no competition there to the PS3.

The problem is people are still looking at this as a three horse race, it's not. This is a two horse race, even Microsoft and Sony predicted that at E3, just with the wrong spin. One horse is the Wii the other is the PS360 (and the PC).

Yes, the Wii wins, but that doesn't mean there isn't room for the alternative. If you forget the Wii for a second, you'll have the 360 dominating America, the PS3 owning Japan and both spliting differently the remaining countries with an edge to the PS3.

Now, you've got to know that some games just aren't fitted for the Wii (not that I like them myself)! If publishers want to sell them in Japan they have to put them on the PS3, if they want to sell them in America they'll put them on the 360, and if they want a shot at selling worldwide, they'll have to port them all around. We are already seeing this happen - exclusives being dropped or reevaluated - much more than we're seeing support being dropped for these consoles and added to the Wii. There will be a market for these games - the PS3 and 360 combined will be significant.

Of course publishers are now waking up and announcing support for the Wii, but that doesn't mean they'll drop the PS360. Actually, those better be novel things they're bringing to the Wii, otherwise they won't stand up. EA's MySims will be big, but Sims wouldn't be so big - and you can bet that realistic looking life simulator still has a shot in the PS360 (and PC) combined.

The types of graphics intense games that you refer to aren't that popular in Japan.  If the PS3 has only sold say 1.5-2 million, many of which as bluray players, when the Wii breaks 10 million why would any developer spend $15-25 million to make one of those games for the PS3 in Japan?  They'll figure out how to get it on the Wii.  The PS3 and 360 have a major flaw when it comes to Japan anyways, as some developers have recently mentioned, they're so huge they take up 1/4 of the living room and would crush the average Japanese person if they fell off a shelf (ok I exaggerated a bit).  Yes in the future Sony could fix that, but by then the Wii will have such a huge lead it won't matter anymore. 

Also somthing to remember, in this hypothetical future where Sony has gotten the PS3's price down to a near mass market level, enough games finally exist to possibly justify purchase, the PS3 is perhaps small enough that a Japanese guy doesn't need to call his buddies over to help him get his PS3 into his house, when all this is happening we'll be seeing the Super Wii at E3/TGS/whatever 2009.  By that time the PS3's poweer will be cheaply leapfrogged so why splurge on a PS3 then?

The US and Europe are different but this is a Japan thread so I'll leave it at that.