This is way too much. Its suicidal to launch at over 400$ as the report claims. Sony legions, including myself, will buy the console at launch, but after that, expect demand to be low just like the Vita. I have a bad feeling. Mainstream consumers will not buy it at that price.

You'll see on February 20. Sure the media and gamers will go crazy over the graphics, but it won't be the sole focus on the console. It will focus on services and functionality just like the next XBox, but to a lesser extent.

No, it's not. Both PS2 and PS1 launch at 39,800 Yen, which translated to $299.

PS3 launched at 49,980 Yen which translated to $499.

It's safe to say the PS4 will be $399. Anything lower and the losses are too great, anything higher and it is overpriced.

For fans, sure. For the normal consumer...not so much.

Please remember this:

Sony LOST money during the PS3 era even at the much higher price point. Sony lost money every year from 2006 up until 2010. Sony literally has been in the gaming business for FREE from PS1 to now. That's what PS3 did to them.

If Sony comes out with another grand subsidy plan, we are not looking at Nintendo by the way, who also happens to have the cash to burn if caught in a death match, Sony is fighting a battle they cannot win! Microsoft is too profitable, too cash rich, and they can match you dollar for dollar for performance and just wait until you DIE. Only company that has beaten them has been Apple via innovations. Netscape, Yahoo, remember Sun Microsystems?

If PS4 lacks any innovation and only competes on specs for this gen, we are looking at a financial disaster waiting to happen. They literally would need to spinoff Playstation as a brand to raise some cash as Sony simply doesn't have the finances in place to dig another multi-billion dollar hole. PS3 was a product disaster, I hope Sony doesn't try too hard on PS4. Pleasing cheap fans who won't pay for even the cost to produce is a strategy destined for failure in the long run.

Edit:  maybe I'm just a little too old, but news of Dell lately brought back memories of the Wang, Sun Micro, Compaq, Gateway....  MSFT made its fortunes by monopolizing the OS and just profitted from the greatest fool's gold ever created in business.  The interchangeable parts.  When hardware manufacturers were led astray by the Wintel empire, little did they know, they were all going to become extinct.  Everyone became assemblers, no longer even capable of innovations.  I feel just a tiny bit uncomfortable seeing the video game console business veering that direction.  Superchunk's chart is starting to look like a Dell, or Gateway, or Tigerdirect product comparison.  Same Manufacturers, same OEMs possibly.  Gimped PCs in a smaller box, costing more than they could sell, and costing a lot for a game to look great, taking down one game company after next.  

When the vita launched the yen was at ~77 so that price makes sense, now you have a yen at almost 100 so the ratios are close (just take of the last 2 numbers), if the yen was still where it was and you at 40k yen price, you would be talking about a $500+ dollar console now as it closes towards 95 you are looking at 40k yen ish being 399-449ish.

PS4 is designed to peak in its 4-5th year on the market. A $400 launch price is perfectly acceptable, even to the "normal" consumer. 
Keep in mind people are buying $500-$600 iPads every year. Keep in mind the $600 PS3 actually ended up being competitive despite the huge losses and much higher price point. I expect the next XBox to have the same price point so I don't see price being a problem this gen especially seeing as how the "affordable" Wii U is selling horribly. It's mostly about the games.

and Sony has the best first party stable in the industry for my money which is why I will buy their console regardless of the other added features.  I'm just excited to see what those studios, who have consistently wowed me with 6 year old tech, will do with modern tech and over 10x the RAM on PS3.