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People are not quite interpreting it correctly. What it means is

1) SONY will cap R&D expenses. This means that they might spend up to ~$1 billion on developing PS4, but not the billions spend on developing PS3 Buying facilities to manufacture PS3's.

2) SONY will not be loss leading by ~$300 at launch, hell they probably won't be loss leading by ~$100 at launch. This is actually a pretty good thing since we want PS4 to be profitable (if its ROI bearly outweighs its costs then why would SONY make a PS5?)