oooh, I was with you until that part. I think Wi-Fi and Blu-Ray is very important, especially moving forward,

It's true that the PS3 is well positioned but not for the reasons he claims.

PS3 has been well positioned since the price cut of last year. It outsold the 360 every month this year. The game library of the 360 is arguably the most diverse and complete off all current gen consoles. However, the game library isn't all that important. For example, the 360 has the best JRPG lineup and yet those games sell miserably. Having the game isn't everything. So, even if Sony doesn't have the lineup to beat the 360 this Christmas, it will still sell more.

If a game is a RPG, and doesn't come with the words "Final" and "Fantasy", in that order, on the box, its not usually a very big seller relative to the other AAA titles he mentioned. Fable 2 is the only upcoming 360 RPG with the potential to sell as big as R2 or Gears 2, in my opinion. From a financial perspective, a lot of the best 360 games coming up are dice rolls (pun intended ...they are largely RPGs ;) ), as far as income goes. RTS games (like Halo Wars) have not traditionally sold big on consoles (with the notable exception of Pikmin, but I would call it something of an RTS "oddity"), so despite the brand, I don't think you can count on Halo Wars being a big seller.

So, while he did mention the crazily-hyped LBP in his Sony list, I would say that he really is pretty close, when it comes to the income potential of the exclusives. Sony has the lion's share in the upcoming lineups. RPGs just don't bring in the big money, generally, unless they are both Final and Fantastic.

In a double-reverse whammy, I wouldn't be surprised if the PS3 FF13 outsold the 360 FF13 by a large margin in all regions, despite near-equal WW console numbers at that time... effectively putting the final nail in the coffin, as far as 3rd party development goes, for the 360 somewhere down the road.

MS needs to get serious with the price cuts.

Sony is going to trick it's customers with the 80 GB "Core" pack. People might just think that core is the 80 gig minus the game, and a small price cut. But the fact that they can see the MGS4 pack at 80 gigs and 500, and without MGS4 at 400 will trick some customers.

Whether or not PS3s lineup is better is opinion, but the PS3 pricing with just one console, with more HDD space, and a blu-ray player gives perceived value. And value > cost. it doesn't matter that the 360 costs less if it has a lower perceived value.

Is Fable 2 really going to be that big this winter? What are you all predicting for sales(those people who put Fable 2 in the league of MGS4,Resistance, Gears and LBP).

I see Fable 2 as a game a lot of owners might like, but I cant see it doing much better than Mass Effect which JUST hit 2,000,000. On top of that whatever RPG fans actually own the 360 will be split between this, Tales, and IU. Its a different type of RPG of course, but I still can't see this title pulling numbers that put it in the league of the other titles I listed in either software or hardware.

Sony and MS are both suck in a battle between market share vs. profitability. Where do they draw the line between attracting more consumers with price cuts, and actually making money to counter the losses they have already sustained this generation?

This

@gebx. Ur letter to Microsoft, seems like it's praising MS while downplaying the PS3, instead of advising them to make a price cut. "Your competitor's BRAND NAME alone has single handlely outsold you in various countries, with no system seller for the first year and a half it was still able to keep up with you even though hit after hit has been released on the 360." Funny cuz in the first year, Uncharted dropped and if I didn't have a PS3, I would've picked it up for Uncharted. Same for Ratchet and Clank (not to mention I know many PS2 owners that traded up because the new Ratchet and Clank). It's funny cuz ur post was agreeing with the guy but was secretly PS3 bashing, that's wat I got from it. If not, just ignore it, could be that I'm Crazzy :))))

Perceived value.

Sony needs to bring the perceived value of the system higher, while not losing money, which is focusing on the cheaper to produce 40 gig, but throwing in the 80 gig hard drive.  And pricing it just fifty bucks more the 360.  So people can say I can get a 60 GB 360 without a BD player, or an 80 gig PS3 with one for fifty bucks more.

Free XBOX Live or a lower price point could bring the perceived value of the 360 up more.

Didn't think of that DMJ, Free Xbox Live will get some sales off those that are on the fence on which to buy. Although, if they were to make Live free (which I think there is NO chance of Live going free), they would need to advertise the "better online experience" going free.