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DirtyP2002 said:

Regarding Sonys finacial situation, they would be close to death if they release a $400 machine and sell it at a loss. Sonys worth is about 15 billion USD and they are losing money. Do you think they can afford a product that is expected to have a 3 billion USD loss for the first 2 years like the PS3 had (not counting R&D!) That is 20% of the whole company.

 

With the Wii U being not the overwhelming powerhouse and the financial trouble Sony is in, MS can piss on the parade by releasing a very powerful machine (significantly more powerful than the PS4) and sell it at a loss, because they can afford it. Sony would be in serious trouble if they face a more powerful competition for the same price and better marketing.

Depends how big the loss is if they release it at 400 bucks, a small loss won't hurt them. They make most of their money on software anyway. Each PS3 was worth $840 at launch. The bluray drive was the expensive component in the PS3 and back in 2006 standalone bluray players cost 1000 dollars. Adding bluray drive won't raise the cost like it did with PS3. Most of the rumours say PS4 is getting AMD CPU/GPU, further cutting the cost by using off the shelve parts. I predict a BOM comparable to retail price, I'm willing to pay 499 euros, the same launch price of PS2.

 

The next xbox probably won't be the powerful if the latest 56 pages long document is true. It looks like MS wants to turn the next xbox in to a media hub set top box. 720 for 299 dollars with Kinect 2? Suppose Kinect v2 is $100, the console itself is then worth $200.