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Pulling your HW loss figures out your ass I see.

Sony has reduced PS3 costs down by 50%, that put costs to make a PS3 at $400 from $800. Seen as the PS3 sells for $400-$500. Sony is either breaking even or making $100 from each PS3 sold, depending on model.

Also factoring in that the PS3 price varies from country to country. Sony could be well on course too recoup alot of it's initial loses, through hardwre costs alone.

I'd take a guess that Sony makes the PS3 for $400 now.They then sell PS3 at approx $360 too distributor, which then sells on for approx $380 too the retailer. Which would leave Sony with a small $40 loss per unit, and allowing distributor/retailer too make a small profit each.