Well what he says pretty much makes sense. In fact the specs he mentions is very much what you would probably find in a mid-range PC in this day.
I built a budget PC a few weeks ago very similar to what he mentions with 8GB RAM, quad core 3.0GHz (can be overclocked to 3.5 GHz) CPU and a 1GB GDDR3 GPU. Trust me, you can buy these components for about £200 retail, so mass produced they would probably be half the price. Plus I'd also imagine MS/Sony would customize the components and they would be completely dedicated for gaming, so no other loads as in a regular computer. Slap on a 1TB hard drive to that for another £50, plus the case, fans, drive, etc, etc and they could have a console at launch that is costing them anywhere between £200-250 to make (mass produced). Sell it for £300 and have a decent profit plus a good install base.
Oh yea, the only thing that I can see potentially increasing costs are these rumoured HD touchscreen implimentations to the controllers. Don't really know if these are to be believed or how much they cost even (wonder how much the Wii U controller cost).
