There's also the little issue of this being over the course of a year. The units sold early last year are likely to lose more money than the units sold later in the year, and the units sold last Christmas lost more per system than the ones being sold today.

Sounds like a lot of guesswork.

I'd say they'd be losing a big chunk in development and advertising. Killzone 2 and MGS4 come to mind. All the internal studios at Sony ... the upkeep most be horrendous.

I sincerely doubt they are STILL losing over $200 per PS3, especially after stripping so much stuff out of the 40GB SKU, and the transition to smaller Cell chips and less power usage and a motherboard redesign. Wouldn't make much sense.

 Na, by now Sony paid off all R&D costs due to royalties from Blu-ray and the profit from the PSP and PS2. 

Frankly I think the guardian is talking bs.

Sony said they expect the PS3 to break even this year. In order for them to do that they have to be cutting costs eft and right. 

Here is the original estimates from 2006 for the PS3's hardware cost. Now Sony has no Emotion Engine in one console and no emotion engine or GSX in the other. The CELL is currently at 65nm, Blu-ray diode costs have droppedby over 85%, due to shrinkage and less hardware a smaller power supply; cooling device; and motherboard was made and installed, bluetooth costs have dropped, wireless internet card prices have also dropped as well as hard drive costs.

Overall even with the price cuts for the PS3. Sony should ony be losing about $100 - $150 a console. With the 65nm RSX and 45nm CELL on their way and another power supply, cooling device, and motherboard reduction costs will be cut even farther.

I expect Sony to make a profit off the PS3 by Fiscal Q2 2009.

Uh SSJ I'm pretty sure there are no Blu Ray Royalties.

Yet anyway.

No one in the Blu-ray consortium has collected royalties yet so that movie companies have incentives to release on blu-ray. (unless they recently changed this policy.)

SSJ12, that's a nice thought and all, but I see a problem. There is no way your statment about R&D costs is correct because they are still doing R&D on the PS3. It's not like they left a shelf full of redesigns, when they shrink those chips and mobos they have to do R&D to make it happen, and if they had already done the work to get the things to 45nm they'd have that on the shelf already.

Plus, Blu-Ray isn't part of the gaming division, so even if they do use that to offset the loses it still couldn't be countedd towards or against the gaming division. Sony may know the money is in their pockets, but it still doesn't get counted that way. Also, Kasz, even if they aren't collecting movie royalties they still get small hardware royalties from other companies that make BR players. Likely a couple dollars per unit.

I do agree that PS3s are likely only losing $100-150, though. And that's not simply for hardware costs but labor, management, marketing, shipping, etc.

The profit statement is a bit misleading - the PS3 is an integrated media hub, so money lost in the game division gets turned into profits elsewhere (TVs, media). Sony is very likely breaking even on the hardware right now, which is exactly where they need to be - they'll be cutting the PS3 to $299/299EUR this fall. Also, Sony has a bunch of mega-projects in the pipeline (GoW3, KZ2) which are consuming resources but aren't earning yet. So this is the bottom of the profit cycle - it's all up from here.

I am so happy for them. They are getting what was coming to them

 I was meaning more they paid off R&D for the 90nm CELL, RSX, main production factories, et. Research of CELL shrinkage is mainly IBM's side anyways. Shrinking of the RSX is nVidia. The only major internal redesigns they do internally is the motherboard.

As for Blu-ray, your right on the royalties part but I think that it benefits them making the same drive for their players and the PS3.

GOW:COO was highly marketed and it pretty much flopped, that could factor in. Other than that, the increased marketing of the PS3 and development of titles such as GT5 (which probably did not profit much since the bulk of the sales started after the fiscal year of 07 ended),KZ2, R2, MotorStorm2, etc could all factor in. Either way, we all know that the PS3 is most likely still unprofitable but $260 loss per console is a bit much considering the introduction of the 40gb model and declining costs of the RSX (which based on the specs should not be too expensive now), BluRay diodes and Cell processors. I agree with the general opinion of $150-$100 loss per PS3.

 I agree. There are a lot of other costs which could be driving this.

How much money have they shovelled into Killzone 2 now? All their other big, HD, cell-powered projects?