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That's the thing though. Can a company that big really have a goal that is so petty?

I mean Microsofts stop Sony plan is less petty in comparison since it's to block sony from moving into an area that they feel is rightfully theirs through the PC.

I think Sony wrongfully thought that loss leading would always be successful...

Either that or they switched buisness models and had to keep loss leading as a matter of principle.

The PS3 does intergrate a number of Sony business ventures like the cell and blu-ray. In a way making sure that neither of those technologies themselves went completely useless.

Perhaps they figured they were set for success and that their brand name was so strong the PS3 would work like the PS2 and in this way Blu-ray and the Cell would gain buisness wise.

Either that or they overestimated the Cells developmental process and thought it would be cheaper by this time... otherwise i don't see the strategy behind using the cell in the PS3 rather then a 360 like setup.

After all, and i may be wrong here since it's been a while but i'm fairly certain loss leading is most effective in the mid price range of products... because the amount you can loss lead is a much larger percentage of what you are selling.

How much you can loss lead has really more to do with your company then your product.