I think it would be a mistake for either company to increase the price and include the new motion sensing hardware. Throw in the new hardware at the same price.

It would be confusing for the average consumer to see two skus - the more expensive sku that says "With Natal/Move" which might not mean anything to them. MS/Sony want people to adopt the motion sensor so they'll make it simple.

It amazes me how much people dont understand HDD pricing. Certainly very shortly MS will discontinue 120GB Elites. The simple reason is it is now cheaper to produce a 250GB 360 than it does to create a 250GB 360.

With that in mind it is perfectly logical and fiscally sound to expect that MS will be able to offer a reduce cost (slim or no slim) 360 this fall with a 250GB HDD and Natal included for $299.99. It could even be less. It will be 2 years between retail price reductions on the core 360 (The core 360 being all components besides the HDD). Components have dropped in price and the combined CPU/GPU will really help reduce costs to an even greater extent.

 - Nevermind - 

They said they wanted to pack a game,eye,move(which could mean they talking combined Move and Nunchuck) in the under $100 mark.and where does it say that always under $100 is $99.

If they shrink rsx,they will make around $50 profit easily.Sony was said to be making $20 minor loss on Slim.The PS3 eye is alot older now its price must have gone down as it atm costs $15-20 to make.The game doesn't cost much oher than developers salary and as its first party,it will cost with packaging and all $15 at max.Toshiba are workig on 32nm Cell which will bring another saving.and the blu-ray and other tech costs decreasing,They will be able to reduce alot of cost by years end.As they have almost done RSX reduction.

Then the PS3 will cost around $200-250 if they are succesfull in reductions in time,then they will be able to pack in the move bundle at around $320 at sony's cost and they will sell it around $299.The loss will be $20-30 dollars which they are already making and getting back with software sales.

And this will only be on bundling,the standlone 120gb and 250gb PS3's will be making profit.

And this is only for US,in europe and Japan,they are already making profit because of their currency valuation.

bullshit.They were losing $40 for the fat PS3.They have made substantial reductions.And retailers don't get anywhere near $30,they sell Console hardware at minimal profits and make most on the softwware.

yeah they will be making profit on wevery quater this FY2010.it was just that before the slim was launched,they stored up alot in warehouses and din't sell it for a long time cause they wanted to push out and clear the fat PS3's.so they had alot of inventry but now it is clear.they made a profit for the Playstaion Division after 5 quater last december so it will get profit

RSX is xoming this or next month which will make them profit along with other tech and blu-ray's price decreasing.and toshibe working on the 32nm cell.

being cheap doesn't make it better.basically all physical formats strenght basically depends upon how much content it has and blu-ray won there.your saying that HD-DVD is cheaper make wouldn't it better.Please talk about quality and not its production aspects.

faster read times you talk about,Blu-ray has variation of speed which are way above hd-dvd.

^Lol, solid snake, you have no idea what you are talking about. I also see there is no point trying to speak with you or gekkoman as neither of you know what you are talking about and can't understand my arguments anyway. Welcome to ignore.

Pott. Kettle. Black. Let me tell you exactly the story behind it (being aware that you will probably ignore it), going by your points one at a time. (Not that this belongs into this thread, but this one has been derailed beyond repair anyway).

1. HD-DVD players were cheaper to purchase

The purchase price of a technologically new device is always strategical. When companies have finally decided to manufacture a new product, there are a plethoria of initial costs involved, some of them include: market research, product R&D and development, marketing the new product, setting up distribution channels, setting up the whole bureaucratic chain for a new product, timespan alloted to "win" the new market, lawyer costs (there will be boatloads of lawsuits coming for any new product), dealer cajoling, etc. Taking all these costs into consideration gives you the price you see in the shops. Initially, the price will be considered very high to the customers, so the manufacturers can recoup their initial costs (with those customers that buy new stuff at all costs because it is new. My first DVD player was $280 and already was a bargain at that time). The price of your new gadget will gradually decline over time (mainly because some/all of those initial costs are recouped, not because "everything gets cheaper over time").

Now we all agree that development costs for the Blu-ray diode was much higher than the violet diode. If both HD-players had been sold at "reasonable costs", they would have sold in the $1000-$1500 region. The fact that "HD-DVD players were cheaper to purchase" ws simply a strategic decision from Toshiba to penetrate the market first, whatever the costs were. This is the _only reason_ those players were cheaper (and sold at unrealistic prices). This is also the key reason why Toshiba failed. None of Toshiba's manufacturing partners were willing to take the same road, losing hundreds of millions in setting up the whole chain and selling their products at high losses.

2. HD-DVD players were unified spec (all had networking support long befor it became common place in Blu-Ray players and for much cheaper still)

That is correct (however specs cannot be "much chaper still" - they are specs). The basic reason was, as we know, sw decoders and copy protection.

3. HD-DVD discs/movies were cheaper

Again this is the same reason as in 1. Movies are not cheaper because they are on different formats - Movie rights are movie rights. When the dust settled, there were more movie studios on the Blu-ray side than on the the HD-DVD side. You conveniently forgot to mention the reason for this: copy protection. Again, if you are on the smaller side of things, you have to make up for it with incentives to the customers - cheaper price in this case.

4. HD-DVD drives had faster read speeds than Blu-Ray

Which has zero meaning in this context. The drives have to decode a bitstream at a certain speed to decode the movie on the disc. Both systems do that.

5. HD-DVD used similar pressing technology to DVD so it was easy to manufacture and easy to produce combo HD-DVD/DVD discs.  (I had 300 which was a combo HD-DVD/DVD disc for only $5 more than the standard DVD back in the day, for example)

This is, in theory, correct. It was touted as a key advantage in pressing the movies - "use your old fab lines and simply upgrade a few machines". Unfortunately for the HD-DVD camp, nobody was ever able or willing to do that. All the working fab lines were in use and not available for upgrading. Somehow it turned out that this option was never a factor, whatever the exact reasons were.

6. Scratch proof discs. A point you conveniently forgot on your list. Blu-ray discs are simply more resistent than HD-DVD discs.

The best part of HD DVD, was that All movies used VC1 and they look better than the blu-ray movies, then blu-ray started to use VC1 as well, the prpoblem is that not every movie uses VC1.

http://www.hometheaterblog.com/hometheater/2006/06/blu-ray-vs-hd-dvd-fact-vs-fiction/
http://blogs.msdn.com/steverowe/archive/2006/08/01/686068.aspx

If there was no HD DVD, all blu-ray movies would be using mpeg2

What I find highly entertaining about this entire debate is that it pivots on production cost having a parity with retail pricing. Yet everyone is discussing two manufacturers that have not only employed loss leading methodology in the past, but who have business models that are highly skewed to the peripheral profits generated from existing hardware. To put it in simple terms it is far less relevant then most of you believe. While the manufacturers may be leery of taking on huge losses. They are in no way inhibited by them.

Were that really the case you would not have PS3 on the market today. How quickly some of you seem to have forgotten the billions of dollars Sony lost on their console. There truly are only two questions. What is the short term situation, and what is the long term goal. Microsoft's short term situation is the one they have enjoyed for most of this generation, and that is of holding their ground while mining profits. They have been very proactive and steadfast throughout the generation. They make the moves for the most part at times of their choosing.

Microsoft's long term goal on the other hand has never been in question. They are not in this market for any semblance of coexistence. Lets be honest Microsoft is a rather vicious competitor. They spent the majority of this generation strong arming Sony into playing the game they really wanted Sony to play. Which was basically a game of lets see how much money we can make you lose. Going so far as to suggest PS3 price cuts to the press months in advance to stifle current console sales.

In summation manufacturing costs aren't really the issue for Microsoft. They can easily afford to take up a loss leading position. Especially with how thoroughly they mine price points, and how well they have exploited peripheral profits from service, hardware accessories, and licensing. The only real question is how predatory Microsoft is planning to be this year. Microsoft as far as the world of gaming goes places a high premium on perfect storm scenarios. They like to really pour it on at those points for maximum impact. They really do believe that there is such a thing as a real knockdown blow as far as gaming is concerned.

This is a terribly old debate. The actions of Microsoft have never shown a distinct correlation between production costs and retail pricing. The costs of the consoles manufacture are never truly reflected in the retail price. Microsoft simply feels no need to function in anything close to a incremental fashion. So to say well they would be selling at cost is nonsense. For Microsoft it is no excuse at all. Their motivations are thoroughly strategic. Their sole goal does not need to be fully large profit motivated if they are achieving a long term goal. Which is basically dominating the market at the expense of Sony.

You may be able to plot the coarse of Sony with production costs, but you simply cannot apply such a logic to Microsoft. They never have worked their pricing like that. In fact they usually make the console fit the price point that they want. The price is almost a built in feature.