In general, if bundles work - where standalone units don't - its one of two things:

1/ Price: (the bundles *are* perceived as a price cut, when someone is interested in the bundled game)

2/ Marketing: If its not price, its marketing. It might be a lot easier to sell MGS4 as "MGS4 + console", then it is to convince someone to purchase "PS3 + game".

I agree that its primarily "game brand loyalty", rather than "console brand loyalty" these days - and that is why the PS3 has suffered.

Its also worth noting this is Ninty's strength - as games/console are generally the same thing (Ninty games on Ninty consoles, etc..).

You can't take Europe out of the discussion. There's a couple of good reasons why the PS3 is doing best in Europe. Most like to point out that E/O is just more loyal to the PS brand. That could be true, but guess what? Europe also has had the most bundled games out of any of the three regions we track.

Bundles aren't just marketing smoke and mirrors that trick people into buying a system. They actually add significant value to a system especially when said system is easily the most expensive option on the market. What will eventually happen is that eventually there will no longer be anyone willing to pay $400+ on a PS3. That's when Sony will cut the price. The real challenge is to make the PS3 viable long enough to cut production costs such that they can actually offer the system for less than $400 and still make a profit.

How do you keep the PS3 viable? Offer bundles.........

'So we all know that PS3 is fine in E/O so keep it to America and Japan. That's where my discussion really is focused in.'.

There have hardly been any PS3 bundles in Japan.

Hasn't it always been about game loyalty? Nothing's changed these days (except war ). The PS3 marks the first time Sony has been late to the market arriving without a robust set of exclusives. In the PS1 days, it was stuff like FFVII, MGS, and Gran Turismo that launched with a bang and drove hardware sales. The PS2 had the sequels of those games all come out within a year of launch plus Sony added the biggest game of this decade at the same time: Grand Theft Auto 3.

In this generation, GTA wasn't even exclusive, FF and GT haven't arrived yet, MGS has only arrived within weeks, and the PS3 still doesn't quite have that brand new breakthrough hit that the past iterations of the Playstation have had (stuff like MGS1, GT1, FFVII, or GTA3).

and yet despite that, the PS3 is 3 million units WW ahead of where the 360 was at a similar point in it's sales history

that aside, I know I certainly picked up my PS3 primarily out of game loyalty.

"Worry" ???

With BR growing, new controller, home, and the whole line-up coming this year
I believe the PS3 could remain "healthy" even without a significatvie price drop.

Why don't they release the 80GB in Europe? Sales would certainly pick up, and they wouldn't have a big loss since the euro is strong.

MGS4 increased sales, not just the bundle. The reintrodution of the 80gb also increased sales, not ust the bundle.

PS3 sales were up this year already, too. It's been beating the 360 all year worldwide. Where is the need to worry?

I think they problem is that, understandably, people immediately compare the PS3 to the PS1 and PS2 - and of course in one sense that is perfectly natural.  But I think it introduces an issue evaluating the PS3 on its own merits that neither the Wii nor 360 suffer from.  Conversely, vs their previous consoles they can only look good by comparision, which of course clouds evaluating them on their own merits somewhat as well but in a positive vs negative way.

Looked at on its own merits vs the market, the PS3 I think is doing well now after a misguided launch. It's the most expensive, it contains tech that is not the standard (BR vs DVD), its main competition for HD gaming was already in the market and had all multi-plat games developed for its tech first... etc. etc. Yet its selling as well as 360 time adjusted and is looking likely to overtake 360 WW sales (on current trends, of course price changes, etc. on either side could alter things).

So looked at standalone the PS3 is doing well, essentially selling better and faster than 360 while costing more and having a weaker library of games many of whom are inferior to the competition's version of said game - not bad right?

But of course compared to PS1 and PS2 it is lacking. But I feel PS3 is different. With PS1 and PS2 neither console was attached to new viewing tech (let's face it if you really want to get the best out of a 360 or PS3 you need an HD TV as well which really puts cost of entry up) nor a new media tech (BR). Perhaps Sony underestimated the potential impact of this - I don't know.

Given 360 early launch (vs PS3) MS had the advantage of effectively reducing potential initial market for PS3 by gaining a good portion of HD early adopters, particularly in the US and the UK, two markets where HD TV adoption would likely be strong and therefore two important markets for HD consoles.

Then there's games. I actually don't think 360 launched any better than PS3 for games (maybe worse in fact) but by the time PS3 launched 360 was past that and had a very good library plus a new big hitter in GoW. PS3 looked weak by comparison even though it really was only going to be a matter of time before that changed - the sometimes piss poor ports of games that looked and played fine on the 360 really didn't help people feel good about accepting their console was effectively 12 months or more behind the other in terms of quality games and stability of titles.

On the back of good versions of COD4 and GTA IV and strong sales for GT5:P I think MGS sales so far shows the potential for big jumps on popular franchise's is back - but I think Sony needs to make sure that in addition to new IP like Uncharted it gets the Jak, Sly Cooper, etc. games out too as well as broadening the genres well supported by the console.

Final point on games - a fair number of playstation centric games (i.e. sold best on that platform) have or are going truly multiplatform and that changes things too - i.e. GTA IV but also upcoming titles like new Silent Hill.  I don't remember PS1 or PS2 having to worry about the competition having an equally good version of a Silent Hill title, for example.  Also, as HD format pushes up cost of development, these games need the combined sales right now - only a paid for exclusive or truly 'fireproof' HD title can make it single platform anymore IMHO.

Now note that for all its innovation the Wii avoids these issues. It's firmly aligned to current viewing tech and had the best price point from the get go. It also had strong games in a regular stream (plus a lot of rubbish but didn't the PS2 suffer the same way also? Let's face it, when the most popular console is also the cheapest to develop for you're going to get a lot of crap games).

Funnily enough the Wii has sold like hotcakes. It's innovation has certainly been a factor in this, but so has price and lack of tech barriers as well IMHO.  This gen if you simply wanted to buy your kids a console and hook it up to the family TV there's only really been one choice (sorry Arcade) and that's the Wii.

So I wouldn't worry about PS3, looked at on its own merits.  It's doing fine and will only improve strongly on the back of many big titles still to come.  It just never had the potential to be a PS2 right out the blocks IMHO due to the above mentioned points - and of course it attracts negative attention for this.  360 also never had a chance of being a PS2 - but its being compared to the Xbox and therefore only looks good by comparision.

And of course the PS3 may even get very big numbers in the end vs 360 - simply because of demographic appeal, nothing to do with which is 'better'.  I just believe that MS are not going to be able to get 360 seen as a family/casual brand this gen at least and therefore will struggle to get past 40 to maybe 50 M units sold vs potential final sales for Wii and even PS3 (if it can slowly claim some of that market back from Wii or at least share it with Wii).

Of course another price cut (if based on cost cuts to keep margins the same or even a little better) plus more of the big titles would help PS3 increase its rate of sale - but its not out of the picture anymore (which it did look dangerously close to) and as MGS launch shows it has plenty of potential to do really well on its own merits.

Sony has always done bundles in the past.