+1.

I would like to refute the notion that Microsoft is just desperately trying to fend off Sony and has nothing but pricecuts to offer to the North American market. That its just a matter of price.

I expect 50$ price cut at TGS and another 50$ just before holidays for Sony.

I do not dispute the fact that retailers do not make money on the PS3 - if that's the way it is, then that's the way it is.  I just noted that there are possibly many other layers of costs in Europe that may not be present in America.  Examples such as tariffs, duties, language translation, distribution channel differences, freight charge differentials, etc.

It is very likely that Europe in general has much higher prices on everything compared to the USA due some if not all of these reasons.

Also, of course it is possible that Sony can keep track of American importers selling consoles to Europe - but is it feasible?  Business is very flexible and always looks to maximize profit.

For example:  If a smaller European importer purchases electronics from a USA distributor and wants to add 25 PS3s to their order (along with TVs, computers, etc.) - then is it not possible for the distributor to fulfill their order?  Also, is it feasible that Sony can track all these small orders?  The answer is most likely not.  It is not economically feasible to track this type of transaction in our global system.

Next example:  If you buy thousands of PS3s as a European importer for the equivalent of US$500 but you know (definitely you will know if you are in the business) that US distributors buy their PS3s for $350 - what would you do?  What would a rational business do?  Basically you would try to negotiate with Sony to drop the price because it doesn't make sense that you are paying that much more for the same item.

So the more likely scenario is that wholesale prices are not that much different, certainly not 50% different.

I have been thinking about this... and now i'm drunk.

There are a lot of excuses to make to explain why my ps3 costs me 634 dollar and yours only 400. Even i can nag about having only a 40gb around without bc unlike americans who have options to chose from...

When the euro started out it was at the same level as the dollar: that means 400 dollar ps3 equals 400 euro ps3, there are restrictions to whom you might sell your console if you have a contract with sony. Hell, your american ps3's won't work without a powersupply/adaptor because our network is different.  What do we want with your bc if al we have is EUROPEAN ps2 games????

You can question whatever you like but if it was as simple for me as buying 50ps3's from an american company just because it saves me 200 bucks a piece... wouldn't the entire economy collapse??? and i mean the world economy, like everybody starts buying their food from africa cause procductions costs are the lowest... and all the farmers in America are stuck with their whatever products????

cheers, and thanks anyhow for making me think!!

@ weaveworld

That's good if I make you think. Double good for making you drunk. Haha

Again, my point is that it may not necessarily be Sony that is "charging" the 50% different in equivalent price.

My main point is that IF you are the European distributor and your cost of PS3 is US$500 when you know that US distributors pay ONLY US$350 - then this situation is not sustainable.

Therefore, a portion or majority portion of the RETAIL PRICE DIFFERENCE may be due to many other factors besides just the strong Euro relative to the US$.

In my example, in Canada, TVs and other electronics generally cost 20% to 50% than in the US. Therefore a lot of people who can drive down the border sometimes go purchase big ticket items down in the US.

Canadian retailers do not pay 50% more for the same goods. The difference in retail price is partly due to the fact that:
(a) transport costs
(b) more middlemen
smaller market
(d) higher overhead costs
(e) higher taxes
(f) higher tariffs/customs duties
(g) lower purchase volumes

So I am postulating that Europe is more like Canada, because it is made up of much smaller countries (though the EU should EVENTUALLY change that, but not yet) than the US - which is just one big market.