I think that even if it had a dvd player instead of blue ray they would be losing significant money. Cant imagine what it is with blue ray. Cheapest stand alone is $400. I heard the Cell chip isnt so cheap either

Firstly, the production costs breakdown that we have all probably seen about the PS3, was printed well before the PS3 appeared on the market. And the costs in this breakdown was close to $900 per unit. Personally I for one minute do not believe that the PS3 was making a $300-$400 loss on each sale. Yes, they would have been making a loss, but not that much. IMHO, maybe closer to $200. Also don't forget that Blu-ray was a hugh contribution to this high cost. Initial thoughts on cost were around $300 per drive.

All in all, going by recent reports from Sony that they should be breaking even next year with the PS3, then I reckon costs mush have come down significantly. I agree with a few people on here that the 40Gb model probably makes a loss of $50-$100 per unit and the 80Gb maybe $30-$60 per unit.

Yes, you can look at the cost of standalone BR players, but don't forget that companies notoriously make these kind of machine for much less than the RRP. If the Samsung player is now down at around $299-$399, then I reckon costs are at least half if not a quarter of what they were a year ago.

well dodece is correct in that, only in the next couple months sony will be selling consoles that were produced after march 07.

 Yes right, the 40 gigs where produce before March 07. What the hell?