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Sony has set themselves up for the next console with this one. Most of the hardware will be the same. The BD drive will be there but will be faster. The HDD and CELL will also be there. The CELL will be clocked faster and will probably have at least 2 of them along with a newer version of RSX. The ram will be increased as well to support the other CELL. So really just some minor tweaks are needed for Sony. The cost of everything that will end up in the PS4 is being reduced by the PS3. M$ on the other hand needs to add a new drive, probably BD and get a new CPU for sure. People seem to forget that Sony is a hardware company first. They have made break even on the PS3 very quickly. With another 7 years for the PS3, they will be profitable for over half of its life. They are also still making money on the PS2 and the PSP. Sony is going nowhere. M$ however will probably launch a new console well before Sony, and if they dont turn a profit with the 3rd go around I doubt they will come back with a 4th.