No company willingly loses that much money when other options are available, especially when facing the wealthiest company in the world and a company that dominated a sector Sony was trying to break into with the PSP. Blu Ray still isn't that big even though its grown leaps and bounds, and whether you want to admit it or not Sony has posted enormous losses in the past few years that can primarily be attributed to the slow drain of software royalties in the Playstation / Networked Products Division. If blu-ray royalties had increased faster than Playstation royalties had fallen, then Kurtagi would have won his bet, but as of now it isn't looking good. I know personally I'll never buy a physical format for movies or TV shows again - you can watch everything you'd ever want legally either freely or for a small price on a computer monitor.
There were fairly widespread rumors at least E3 that Sony was going to consider scrapping PS4 if PS3 didn't turn around to big profits soon. Every Sony system - PS1, PS2, PSP, PS3 - has launched for a loss. Once PS4 becomes their main system without a huge long tail from a system as dominant as PS2 they're going to be in even more trouble than they are now as it isn't like costs are coming down. Even Wii games cost alot more than GC games did to make.
People are difficult to govern because they have too much knowledge.
When there are more laws, there are more criminals.
- Lao Tzu











