This should prove once and for all that Ps3 will NOT see a $100 price cut this year. At best there would be $50 off. Still great news for Sony. They have to realize that they are not going to sell 100m+ consoles now, so they can no longer keep betting on software only. They must be profitable in hardware as well.

Possibly the revision is due to the fact that BluZilla mopped the floor with HDDVD, so the price of BluRay tech, which has already fallen fast, will fall even faster, and Sony's earnings will be correspondingly greater.

Also, that $400 price tag is a bit misleading. Sony is selling lots of BC-compatible $500 systems, which are either breakeven or slightly profitable, especially in European markets. They've got plenty of headroom to shave $50 off the PS3 in July and another $50 in October, though my guess is they'll wait and do the full $100 cut in October.

Either way, $299/299EUR is coming this holiday season, guaranteed.

 I'm not saying that their good games don't sell. What I meant was on the PS1/2 gens they sold 100m+ consoles and received nearly every 3rd party game possible, thus giving them a ton of revenues from solely software. Since the PS3 won't have that base and thus won't have the same 3rd party support in the long run, it won't get that same software revenue.

 your right, by the summer the 45nm CELL should be in the console and the 65nm RSX.

How is that exactly?

Well they'd be well ahead of their schedule if that was the case.

Very wrong. The last announcement they made was that they wanted to break even on PS3's come 09. Your right about the 65 and 45 nm... not about costs however.

Some analyst claimed that they were breaking even a few months back but that was it.

Sony hasn't said anything since the comments about hoping to break even in 09.

Initially the PS3 was supposed to break even right about now though.  The analyst is probably using old data if anything. 

title is a bit misleading. Any hardware costs are offset by the hideously expensive games. I am pretty sure that without write-offs for R&D etc. we would be already in the black for the PS3.

Seems pretty clear a price cut maybe on the way; I still dont understand why another price cut hasnt happened in the UK yet. 40GB retails for equivalent $600 in the UK, so at least a small profit is being made from what I can gather of the production costs. They must be quite reliant on the money made from europe to offset some of the american losses?