It'd be able to have the specs currently rumoured, but also compete with even the Wii U in pricing.

I haven't forgot the PS3, I know the $250 loss that took was disastrous, but things are different this time. At that price it'd almost definitely have a huge first year. So keeping in mind that unlike PS3's situation Sony will have plenty consoles out there, comparatively tiny R&D costs and be taking a loss that's a little smaller, let's say they really push PS+ and other subscription services on their platform and have a ton of high-profile games in the first year (meaning good game sales), could they offset the losses (at least enough to not kill them)? Or would the extra marketshare not be worth it?

Personally I'd go for $399 with $50-100 loss, but the above seems like it could work although it's a large risk. 

It won't.

You'd need to sell MANY games to balance out a loss of 200$. I don't think it'll happen.

It was predicted the PS2 was losing around $180 when it was launched. PS3 was losing around $300, even at its premium price of 599.

Without much doubt I can say both the price of PS4 as the loss per unit will be much smaller this time.

Are sony capable of such a loss if the playstation sells well?

Yeah... but this time you'd also other services that make money. I'm sure they profit from all the TV aps like netflix/lovefilm etc. and PS+. If Sony managed to get 10 million people subbed to PS+ (doesn't have to only be on PS4) they'd be making £400,000,000 more or less per year directly from it. Not all of that would be profit of course, but you have to imagine they'd still get a large chunk.

It would prove to devastate their company even more. I would think next-gen would bring them with a smarter sense of business tactics. I'm looking forward to the PS4 ... I think the bad taste is finally gone!

So that's very similar to the scenario I've suggested, except this time Sony won't sell as many consoles but will have even more ways to make money from each person.

hmm...

8 mil units = 1.6 billion loss

Question is could they offset that.

Does anyone know what the average profit Sony make from game sales is? As in from a single game.

That's true, but we also have to take Sony's financial situation into consideration. Basically it boils down to how much money Sony thinks they make with the games. The more sales they expect the more the price could go down.