What if PS4 was $299, but took a $200 loss?

[Aielyn]

If Sony were crazy enough to release the PS4 for $300 and it cost $500 to manufacture, then what would be the result?

Probably a massive rush to buy PS4s at launch, followed rapidly by Sony going bankrupt or the management being fired. Sony isn't in a strong financial position as it is, and the PS3 is one of the few things that are keeping them from completely going bankrupt. They can't afford the massive early losses that such a pricing would inflict on them, anymore. The PS3 took something like 4 years to start to be making an annual profit - to my knowledge, it's still in the red for the entire generation. The Vita struggling so much will only add to the strain.

Sony needs to play it conservative. They can't go massively powerful, and they can't go with a massive loss-leader strategy. They might be able to get away with a modest loss per console - of the order of $20, if they're feeling lucky - but anything more, and they're just not going to be able to sustain it.

Microsoft might be able to take such a strategy, as MS is in quite a strong financial position. Nintendo could do it if they were of a mind to, but they'd never actually do it. Sony just isn't going to, because they just aren't in the position to do it.