Sony needs to launch at a profit. They are bleeding money not only the PlayStation brand which continues to struggle but the entirety of Sony. PlayStation 4 needs to bring in a profit on hardware and software.
If PS4 launches with Cloud and has very little internal memory. If Sony does not seek to compete directly with Kinetic and Nintendo's tablet instead launching a slightly upgraded Dual Shock with maybe a touch pad in the back and some gyroscopics. Sony could launch a system say 8x the power of 360 while Microsoft has a 6x system and Nintendo 2-5x. Sony could sell a graphically superior console at a much cheaper cost. A 50$ profit selling at 350$ retail would not be hard to believe.
-JC7
"In God We Trust - In Games We Play " - Joel Reimer