I think it's because they're much more complex compared to general purpose CPUs.

@rocketpig, @lafiel, @stranne

Shrinking the process to 45nm decreases the distance electrical signals must travel every clock cycle. This allows a chip to run at a lower voltage when clockspeed is held constant. This allows a chip to run not only with lower power consumption and heat generation (P=V^2/R), but also reduces gate leakage (which further reduces power consumption) which is a significant cause of circuit failure. Gate leakage is the reason you can't just overclock your PC's cpu indefinitely even with fancy cooling equipment. It's also why your OC'd machine will tend to be unstable even though it may POST.

 If you reduce gate leakage you increase sample rate.

The base PS3 will always be more expensive than the base 360 because of the hard drive. And to a lesser extent the Blu Ray drive.
Microsoft engineered the 360 to be cheap to make. Then they have a high powered manufacturing cost reduction team. They too are constantly improvong their chip fabrication.
Also, at the end of the day, Microsoft can much more easily afford to subsidise the selling price.

So I don't see PS3 ever having a meaningful price advantage over the 360 for a meaningful amount of time in any of the main markets.

 That confused me too, but in the article i read on arstech, IBM stated that the smaller 45nm cpu is smaller and therefore had a higher rate for success(huh?) Lol I dont get it either, but thats what IBM was saying, so i just assumed it was true. Maybe they meant console has a whole however, since less components means less room for errors. 

That would make more sense 

Good news all around. The future is looking bright. Hers to sony jumping on a parity price cut with GTA4 and really opening the doors to HD.

Umm, not true. MS engineered the 360 to be small. That was one of their primary focuses after the x-box and peoples complaints about size. This in turn caused the system to overheat. With the failure rates due to heat, they have been spending a lot of time figuring out how to reengineer everything just so it doesn't break. Some aspects of the 360 actually cost more today than they did at launch.

Plus, if 30% are failing, that's a 30% increase in manufacturing costs (not including shipping). MS needs to find an alternative way to compete with PS3 on price. Hardware is not going to be it. They could reduce (or remove) the cost of XBL, or offer cheaper software, something.

My guess is the PS3 and the 360 (with HD) is going to hit $299 at the same time. When that happens, form strictly a hardware perspective, the PS3 will have Wi-Fi, Blu-Ray, Rumble and Motion, be quieter, and have much better reliability.

MS will have to find a different way to compete, other then strictly the hardware.

The next step is 32nm.

have they shrunk the GPU yet, last i read RSX was still on 90nm process

I doubt they ever change the GPU's process. It's already reduced from the original G70 at 110nm BTW.

@ stranne )

and I wanted to say , that the successrate per waver is the one that counts