The Ps3 production costed a whole lot less to make than we expected.

Link: http://www.bloomberg.com/apps/news?pid=20601087&sid=aYWkGuoeuipo&refer=home

MSFT still loses on the 360? Thats crazy.

Well (technically speaking) the PS3 couldn't have been profitable before the price cut because they were manufacturing many times as many units as they were selling ...

"Clearing up the trouble made PS3 profitable several months ago."

Does anyone actually believe that?

That's not exactly what Tretton said. You also have to factor in that he's putting the best possible spin he can. Do you really think he is going to say that they lost billions of dollars for a product that is still losing gobs money?

And didn't they just say two days ago they weren't planning a price cut? 

I'm pretty skeptical about this, but it's well within the realm of possibility.

The increase in PS3 sales being closer to 50% than 100% is the first time I've agreed with Pachter. Of course I still believe it'll be closer to 0% than 50%, after the first two weeks anyway.

I honestly refuse to believe that the X360 still loses money per console.

After 2 years? Microsoft arent that incompetent - especially considering that the 360 doesnt have a HD player or anything.

 Edit: Also I think the effect of the price cut will be marginal because people always seem to buy the top end model = Im not sure if the 60GB is going to last. 

 I'm in the same boat.

I have a very hard time believing two parts of this article:

- The 360 is still sold at a loss? I can't believe that for a minute. When you add up the components, it just doesn't make sense.

- Sony was profitable on the PS3 before the drop. While they may have been close to profitability, I have a hard time believing they dropped the cost that much in 7 months. But, if they did, amazing. That's quite a cost shavings in less than a year.

No. There is no information here other than, "they fixed the blu ray production issues and it's profitable now." The estimations for the PS3 put the Blu Ray drive at $100 or something originally, so unless it's free right now, they aren't saving $100 on the BD. Further, even if the BD was free it still would not have been profitable at $600 -- estimates put it at $840 w/ a $100 BD.

I think PS3 sales will be only slightly affected by the price cut.  There's no way in hell it will double sales.  The PS2 was available for $500 before.