I think that, if PS3 sold for $300 from the start, it might have buried the Wii.  Well, maybe not buried, but definitely blunted the Wii appeal. Let's take a look at the advantages of the two:

Wii -

• innovative play
• lowest cost
• first party properties

PS3 -

• established brand
  
• full library of PS2 games
• HD output
• BR player
  

But PS3 does not have a value proposition because there is a limit to how much the public will spend.  The public didn't really go enmass to DVD from VHS until the Chinese came up with the sub-$100 players.  It can only be expected that only the ultra-loyalists and the prosumer types that bought the first gen DVD players for $500+ would go for the PS3.  It simply did not have a value proposition. 

Now, let's introduce the hypothetical $300 launch price, holding all else equal.  First that just blasts Xbox out of the water because it's cheaper and offers far more.  So now, there is only the Wii to consider.  Consider a common household that already has a PS2 (remember far more households have PS2 than the other two), but is also looking for the next gen.  Will they

1. buy a tried and true with new features or
   
2. try a new unproven game play?

I suspect that people would tend towards the former.  Now, the $300 + game + extra controllers + etc is spent, it's very unlikely that the same household would try a different console for a while.  This means that Wii would sell far fewer because only families which are Nintendo loyalists (there are many) or multi-console households would buy the Wii.  This would blunt its buzz and the studios would not jump ship.  Which would bring more people to buy PS3 because of the positive flow of games

Basically, PS3 simply priced themselves out of the market. the 360 set expectations (regardless of costs to producer, consumers don't care).  PS3's price put many people who would have bought the PS3 at the 360 price (probably been saving since the 360 launched) in the wait and see mode.  With the buzz on Wii, and the saved money burning a hole in their pocket, casual consumers flocked towards the value console of this gen, the Wii, compounding the PS3's woes.

In short, if PS3 were to sell for $300, I'd expect Wii and PS3's position to be reversed.  In fact, this is the consensus before the PS3/Wii launch.  Which is why virtually all developers were caught with their pants down in Wii support when Wii kept selling 2:1 to PS3

The only game between the 360 and PS3 that I want right now is Armored Core 4. That's it. Maybe Eternal Sonata/Trusty Bell by the end of the year. Nothing else falls into the category of games I play and enjoy. Between those two games, I couldn't justify even paying $200 for a PS3 or 360, so why should I bother considering them when they're priced much higher than that?

think that, if PS3 sold for $300 from the start, it might have buried the Wii. But it didn´t so there is not point talking about that

It is a possibility.........think of this  How cheap would the PS3 be if it only played games.....no DVd and no Blue ray

199??   249.99 to compete and give the wii a run for its money, the low dollar amounts atract, i agree.

 And if the Corvette was sold at 1 dollar, then they would own 99.9 percent of the Automobile market.

Please, stop saying that the Playstation 3 should have been 300 dollars. No one is realistically arguing that such a price drop wouldn't make a dramatic change in sales: it's just economically feasible.

Using the example I listed in the post above: the PS3 would probably dominate if it were 300 dollars. It would also force Sony to go out of business. They are already posting a 650 Million Dollar loss: the price drop would increase that to almost 2 billion dollars. Sony is a big company, but that simply is.not.sustainable. No company in the world allows 2 billion dollar losses in the hopes that some day they might -- might -- recoup that and more. 

It's silly to argue about a $300 PS3. If you're going to argue that, then you need to compare it to a $49 Wii or a $149 360.

If the PS3 had no blu-ray player, no DVD player, was slightly less powerful than the 360, and sold for $300 then yes, it would have crushed the other two systems.  With the Sony brand name loyalty they would be gauranteed a victory.  I know I definitely would own a PS3 by now and wouldn't need to waste time with the other two systems because most of the good games would be on the PS3.  However, that's not what happened.  I personally find this console race fascinating. That's why I check VGChartz every day.  I didn't care at all last generation because Sony clearly won, but this time it's different.  What Nintendo did this generation was nothing short of brilliant and Microsoft did a lot better this launch than last launch.  Sony screwed up big time, and the only reason the PS3 is still alive is because there is so much loyalty to the Sony brand name both from gamers and developers.  However, it's enough to save it from death which is what makes this generation so interesting.  It's no longer completely one-sided.

WELL PUT!

I pity the competiton when Wii hits its stride in mid to late 2008. Sony says they plan on keeping the PS3 around for 10 years and the Ps2 for 7 more years but I think they're just honestly delusional.