Sony made a lot of money on PS1 and PS2.

And all that money has nearly disappeared in two short years. 

I think everyone is forgetting that in the end the bigger picture for Sony was simply to push Blu-Ray into the market with the PS3 and although a lot of you are saying that they are not being very smart doing business they actually won in the end because it looks like Blu-Ray is gonna be the next DVD format and thus making them billions of dollars in profits eventually. No matter how much PS3 sucks and losses money or losses marketshare to MS or Nintendo, they won with Blu-Ray and that's what really mattered to them.

The problem with using the PS2 to try to steal casual user base from the Wii IMO is this: It also encourages 3rd parties to continue making titles for the PS2 - which will all also be on Wii. Effectively it makes it even MORE cost effective to make Wii games, because they can continue to port them to PS2 (or vice versa).

Short term this might work somewhat for Sony, especially in Europe, but irregardless PS2 is slowly dying while Wii quickly rises so I don't think it'll hurt Nintendo much longterm, and may in fact benefit them more than Sony.

Well I have family, who are finally buying a Ps2. That's 8 years later. Why, cheap, games are cheap and it's well known. I think parents will start to buy the ps2 for family now The Wii is the cheapest next gen console at $3?? Au (I think) as opposed to ps2 at $199au.

I don't see this working for Sony to be honest. I agree with the point made by Gamerace - it will benefit the Wii most of all because third parties will release more games for it.

It will create momentum for third parties to cross over to the low cost casual development paradigm exemplified by Nintendo.

This is likely to detract from the PS3 and the costly 'hardcore' development environment of the HD systems.

It would surely extend the life of the PS2. Who knows, maybe it'll outlive the PS3?

Now that would be funny!

 The their shareholders will say, Kill the Playstation and focus on Blu-ray players

FWIW, Atari supported and sold the 2600 past the lifetimes of both of its successors, especially the 5200. Not that Atari in the end was a great success story past 1983, but there's a history lesson in the reasons why the 5200 failed miserably and was eventually abandoned with focus placed back on a 7 year old console. For the most part, it was price, no backward compatibilty, undesirable controllers, and a lack of interesting games...all of which led to very little 3rd party games which killed it even faster.

The refocus on the 2600 kept Atari alive (well, on life support anyway), so history does backup Sony's new direction. The other part of their plan was the introduction of the 7800 which was alot cheaper than the 5200 and had full backward compatibility. Anyone think Sony might consider a new console that is slightly more powerful than a PS2 with full backward compatibility with a Blu-Ray drive in it? =)