Well, as far as I remember it was not just fans saying so, also some news websites. I'm not saying those are reliable enough, as you can see in my original post, but "it's time to inform people of the truth" sounds a bit pretentious unless you have a really good source. I hope you do have one, because I'm curious about this issue.

The Gamecube and XBox reduced their prices because the PS2 cut its price ... Nintendo wasn't hurt that badly because (although it was a more powerful system than the PS2) the hardware was inexpensive enough that any losses were short term; the XBox (on the other hand) lost over $4 Billion (or about $200 per system sold) largely because hardware losses were never recovered.

Sony is not known for reducing prices early and likely choose the $600 price point because they could afford to sell the PS3 at that price after the 65nm process was implemented and the Blue Laser diode was reduced in cost;Sony never considered the possibility that either the PSP or PS3 would be unpopular compared to their competition and thus didn't anticipate needing to reduce the price of either system early on. Any moderate ($100) to large ($200) price cut would produce large long term losses to Sony's gaming division.

Could Sony afford to reduce the price? Possibly, but shareholders would not be happy if Sony (as a whole) had a $1 Billion loss because of the PS3.

you know what after reading alot of threads today of what people think.. i dont even think it matters if i post a link... its from a gaming website but thats not even a good enough souce anymore i guess..... people are gonna think what they wanna think no matter what.. so its not even worth it... Microsoft themselves could say we wont make a profit off the 360 until 2008.. and people would still not believe it so it doesnt even matter dude.. people think what they wanna think and thats that

Nice dodging!

You are right that a gaming website probably doesn't cut it though, unless they are respectably quoting someone involved in the production of the Xbox 360. The reason I say this is that all other sources say contradictory things and they're as good as each other, so not informative enough!

Example of a semi-respectable website saying the 360 is making profit on each sold unit:

http://blogs.zdnet.com/carroll/?p=1710

I could find you hundreds of those websites, yet it wouldn't prove anything since they are not quoting Microsot directly. I suspect the same happens with the websites which say the opposite.

call it what you want but its the truth... have you looked around lately??? it really doesnt matter at all...

Right now in my opinion the PS3 is in serious condition. If they don't do a price cut before the end of the year it'll go from serious to critical condition and will affect the PS3 for the next 2-3 years.

The fact of the matter is that the PS3 really doesn't have a hugely anticipated exclusive sequel game coming out this Christmas like the competition does with Halo 3 and Super Mario Galaxy so a price drop is one of the ways it might be able to try to combat that.  It really is too bad that Gran Turismo 5 won't be ready this year.

Is it not a couter point that the Xbox360 has been unable to reduce its price more than $125 considering its sale of 3 times as many units as the PS3 and year lead to reduce its cost of production. I can't really see the $100 dollar price cut for the PS3 being anything but detrimental to Sony overall it may pick up sales but still believe a $500 dollar price is going to be a giant mental block for most consumers. Its most likely in Sony's best interest to leave the price alone if they aren't going to drop it by $200 which would cause them a huge loss at the moment, because at $500 your still appealing to what would be a niche market albeit slightly larger not the mass market and for that slightly larger market share that has to be around 1% you undercut all your price reducing as of yet virtually guaranteeing similar losses to your first two quarters and as many have mentioned you gain none of that $840 per system sunk cost back on the 2 million sitting in warehouse in all actuality the price of these systems goes up as you pay for their storage.

Theres no need to fear BoNaFiDe is here!!!!  me being a sony and microsoft guru.. i know about both sides of the story.. if this helps you all out any i have a link.......  

Link being as recent of may.... no numbers are shown just quotes from  MS guy.....

2nd one Link MS losing 75$ as of september 2006..  sony losing 241 as of the same day.... 

LINK shows sony has cut production cost since then.. 

LINK shows sony could have cut the cost down to at least 150 dollars as of May 8th

LINK shows sony has cut down the price of a key component

LINK show microsoft could be making a 75 dollar profit on the 360's..  but that chart has been edited so many times many said it was not true

My point is they both have reduced production costs since they both launched... i expect the 360 to at least be close to breaking even at this point ...if it is taking a loss i dont think its that much at all....

also i dont think sony is still losing 241 on each console this is the reasons why so many analyst have predicted a price cut this year... because believe it or not they have brought down production costs... i think they are still losing over a 100 on each console though but i dont think they are losing 200

whether this changes anyones mind i personally dont care..

Thank you for those links Bonafide732. That really seems to be among the most accurate information, and any definite statement contradicting it will have a hard time getting proved unless it come straight from the horses' mouth - Microsoft or Sony.

Thanks for the links, Bonafide.

There's a troubling bit of information about the 65nm technology for the CPU and GPU. I thought they would be ready by the fall for the PS3, but the Digital battle link says expect them in 2008. These would've been a significant reduction in price and made a PS3 price drop a lot more plausible to arrive this year. Also, it appears a big chunk of cost is the PS3's motherboard. I guess it has to be to accept the RSX, Cell, and Blu-ray.

URNotE, links are always appreciated, but the source is always scrutinized. Don't let that discourage you from providing proof for your claims.