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Dodece said:

@thismeintiel

Initial cost analysis of new technology is almost always hyperbolic. The same holds true for technical issues as well. Until challenges are overcome it is simply being assumed that they are insurmountable. While in development you have to see these things as being the result of unknown variables. I have read these same figures before they were applied to both the DVD and BluRay formats. Yet when they came to market while expensive were not prohibitively expensive. There is no realistic reason to expect differently from Holographic media.

Companies do not develop technology that will be impossible to sell. They obviously feel that they can make the product cost effective, and the media cost effective. Otherwise they wouldn't be spending the money developing the media. This all before the effects of mass production are made clear. You cannot underestimate those either. That is how BluRay went from eight hundred dollars a machine to a hundred dollars a machine in the span of a single year.

I am not saying it would all be out of the box profitable for Microsoft, but it probably wouldn't be absurdly expensive. Not to mention they follow a loss lead model. So if losing a hundred dollars on a new format gives them a hefty edge they will probably go that route. Anyway the entire storage issue is mostly for chest beating anyway. The truth is the vast majority of games fit onto DVDs. The PS3 didn't need the BluRay it was just equal parts trojan horse, and bonus feature. The games most assuredly didn't need the extra space.

I was not able to find any source that gave a similar estimate for new DVD or Blu-ray players before they were launched.  Do you have any?

My real point is it would be quite crazy for MS to do exactly what Sony did with the PS3.  Sony was losing ~$250 per system and has only started making a profit on each PS3 about a year ago.  If HVD proves to be even more expensive than Blu-ray, then MS could be looking to lose ~$350-$450 per console, especially if they want to have a graphical powerhouse that can pull off graphics like that seen in the Unreal demo.  And those losses would be incurred even if MS priced the 720 the same as the PS3 launched, $499/$599.  And MS wouldn't be able to to recoup any costs with movie sales or licensing, because this is GE's tech.  I doubt even GE would get any real support for this format, since Blu-ray is still picking up and is seen by most as THE HD physical format, with the vast majority of companies not even planning to release anything HVD related til 2019.  Also, I doubt game companies want to spend more money per game, as the price of the discs will most likely be higher than Blu-ray's initial cost. 

And if MS does go with HVD, they will pretty much be handing Sony next gen.  Sony has already announced they will not be making as huge of an investment in the tech of the PS4 as they did with the PS3.  This means Sony will most likely be going with the much cheaper Blu-ray tech (in 2013, Blu-ray will be incredibly cheap for companies to utilize), as well as a much more powerful upgraded version of the Cell.  I would be surprised if Sony prices the PS4 for more than $499 for the top of the line version.  I think the price would be closer to $399-$449.  And Sony would probably be either losing very little or making a small profit off of each console.