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http://www.ps3fanboy.com/2008/01/11/ps3-production-costs-cut-by-half/

According to that link the ps3 production cost has been cut in half. Idk if sony profits or not from 40 gig ps3 sales but i doubt their losing as much money as may believe. Anyways my point being that sony could do a price drop when the time is needed (MS drops price.) Personally I think sony should drop the price before ms does because theyd be the ones getting most of the attention because they did it first, though i dont think its possible at theis point.