Bodhesatva said:
Sigh, so wrong. The key problem here is that game hardware is an amazingly low margin product. Your assumption about profit margins with loss-leading hardware is spectacularly wrong. Do you know how much money TRU pays for a 399.99 PS3? 399.98. Until the end of a lifecycle, retailers traditionally make 1 penny on loss-producing hardware like the PS3. Software is a different story, which is why there are random deals at all varying stores going on all the time. The suggestion that Sony is not involved in this sale is ludicrous. I would recommend you read (or take) economics courses -- even basic ones at the college level. Or, I recommend you work at a retailer like Wal Mart. Either would likely allow for greater insight into these sorts of concerns. Again, who has the greatest marginal benefit here? Clearly it is Sony, by a wide margin. Wal Mart gains little. Stand alone Blu Ray manufacturers gain some, but not nearly as much as Sony. All of them will take a part of this hit, but unless you'd like to turn traditional economic models upside down, the party with the greatest marginal benefit shoulders the largest marginal cost.
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This isn't about hardware, and I thought I was clear on that. This is about the major retailers taking a loss (and not as big a one as many here are imagining) to grow the market and increase the profit-potential/liquidity of their hardware shelf-space.
Retailers take the single-largest portion of the revenue from new console games, as I said. They stand to benefit *hugely* from increased market. The games industry is a lot different from the typical, mature industry you might be lectured on in college -- don't make the mistake of assuming its even remotely similar to any industry outside of the DVD-side of the movie business, and even then its not a very close similarity.