I read that, blue. Thanks.

Usually its due to better yield. When manufacturers make processors, not all the processors made pass inspection. For example I remember when the Pentium 4 was initially released some models had an abysmal yield rate of like 30%. That meant that only 1 out 3 processors passed but as years passed and the die shrank, the yields improved a lot. I assume that is whats happening here. The yield probably improves but dont take my word for it.

The 65nm chips would definitely reduce the price. You are correct, dallas, in that they change the motherboard, as well, to support the 65nm chips, but these changes are usually reduction in the parts used. The CPU is smaller, consumes less power which means they can reduce the amount of transistors on the board, and they can produce a greater number of 65nm chips at the same price as the 90nm chips. For example (and this is just a rough example, not one to be taken serious), let's say in this picture: they squeeze 100 90nm chips on that wafer. When they reduce the chip size to 65nm, they'll be able to produce about 30% more chips, or about 130 65nm chips. That means, for the price you would've made 100 90nm chips, you just made 130 65nm chips. This would be the same for the GPU, as well, when they reduce it to 65nm.

God damn thats big, they better not make something like that with the Cell. It will take over the world!

Yields increase with decreasing die size due to 2 things: 1. more chips per wafer 2. impurity will hit the same number of chips but will be lower % of the total yield, hence improving yield.

Actually, it's twice as many, as we're talking surfaces, not lenghts.

If they want to return to number 1 they need a 200dollar price drop .The PS3 for 400 would be really a superb value . Still ,if there isnt any game ,or any exclusive game ,released the price drop wont do it all . So they must time everything to make coincide the price drop and some high profile games as Ratchet and Clank and Heavenly Sword coupled with other multiplattform as Unreal 3 etc . Now ,a 200 price drop is almos unheard of .I saw one when the Xbox first launched here in Spain ,it was 500 euros and when after two months it had sold next to nothing they had to reduce the price two times in a row .Once it was at 300 euros the thing started to sell normally .Maybe Sony should do something like that . As for the losses it makes them it is relative .They are selling the consoles in some places as Japan and Asia at roughly 400 dollars or less ,so that price must not be so far of the profitability as we think .To be clear ,the 800 dollar cost per machine is not very realistic .Besides ,if you dont sell the machine you are taking a 800$ (or whatever ) hit .Selling at at the maximum price the market accepts and then trying to recover through software and BR movie sales is the way to go if things go really bad .The solution isnt selling it at 600 in small quantities and have millions of stock left in your stores .Sony will have to make their act sooner or later . Some exclusive games and a drop of 200 would be the way to win ,but if that price drop is impossible then they will have at least to cut the price by 100$ and see how things follow . As for price drops go the production in 65nm ,the elimination of the EE and the reduction of the blue diode are for sure saving Sony at least some 100$ out of the machine .Plus of course the fact that the succes rate in the fabrication of the components and the consoles itself must be improving a lot since last november .

Lol, well wishing Sony fans, sigh...

Listen...

The PS2 sold at a loss of $50-$100 a unit when it launched, had a successful launch, sold phenomenally well and was a commercial success. Yet even with all this it took more than two years before it dropped even $100.

The PS3 sells at a loss of $200-$250 a unit, has had a poor launch, is selling less and less and is a commercial nightmare resulting in a 2 billion dollar deficit for Sony. And you expect it to drop in price any sooner than the PS2? Tsk Tsk.

Sony is not in a position to lose anymore money, only because of pressure from game developers did they even sell it less in Japan and that was well before the 2 billion dollar loss. Heck in Europe they took out reverse compatibility to lower production cost but still kept the price as high as it was going to be in the first place. At this point Nintendo has more loose funds than Sony does. Stop kidding yourselves, a price drop isn't going to happen.

I don't think Sony really has a choice, Gballzack. They have to cut the price, and will probably eat the losses. Sony, as a company, still made a profit despite the 2 billion dollar loss from SCE. Production costs are dropping with the removal of EE, as well as the cost reduction in blu-ray diodes. Even with a good fall/winter lineup, they need, absolutely need, to drop their price. This holiday is crucial for them.

No, they don't have a choice, they can't drop the price. IF they drop the price even more the stock holders will fold and the company will be forced to forfeit the Playstation line, its that simple. There are too many invested interests in their money for them to act so recklessly.