IMO Sony shouldn't. What Sony should do is to improve the PS3 experience through games and services (which is something they're doing right now). They'll just lose a lot of money with a price cut. Right now, the Wii is on track to being the dominant console, so there's really no point of price cut (what, do all that for second place?).

I think it's better that the PS3 be well regarded in its lifetime, like the Dreamcast and Gamecube. While it had a horrible launch, the PS3 has been improving its lineup, and hopefully its service. In the case of the Gamecube, all the goodwill on that machine is transferred to the succeeding machine, and look at the Wii now (I remember there were rumors about Nintendo exiting the console business during the GC, but Nintendo ignored it and just did what they do best on the GC).

Also, if there were a price cut, DMJ will NEVER get a PS3 in his lifetime... Please have some mercy.

wat

No, Sony has nothing upstairs.

I read part of your little speach and I dont need to read the rest of it, or any comments. This may have been said and im sure it will be said again.

SONY CAN NOT CUT PRICES! They are already lossing tons of money on each system sold. They are aready in the hole 300+ million dollars (just Sony's gaming div BTW). Thats more than the PS2 made in total profit! If you want to complain know your facts first. I myself would like Sony Games to stay for the next generation just to give Microsoft and Nintendo some compatition. If you want Sony to lose so much money they dont even consider doing the next generation Playstation then by all means bitch to your hearst content.

 you think they will let move in upstairs? been looking for a new spiffy place to live

 you do know sonys gaming division made a crap load of money dont you? and they are indeed not losing tons of money on each system sold, more likely around $1-100 per system sold (my opinion around $35 lost per system)

The thing is WW Sony is selling 8.4 games for each console sold, so they can afford at least a $50 cut. Plus they could make as suggested at other post and make a cheaper SKu, with no BC and smaller HDD and a more expensive one. People are still interested in BC. I could swap my No BC PS3 for a BC one at $399. But I think they are waiting for LBP release to do a price cut.

Actually SCE (the game division) lost 1.2 billion dollar march 2007 - march 2008. (http://www.sony.net/SonyInfo/IR/financial/fr/07q4_sony.pdf).
Not exactly good, but the year before was about double that.
It's safe to assume that they're not losing money on PSP and PS2, so it's clear that they're losing A LOT on PS3.

Sony has made great strides in cutting production costs of the ps3. The blu ray drive is much cheaper now, not to mention the Cell and RSX which are both made under the 65nm process now.
I'd say chances are 50-50 of a price cut happening.

BTW I read on wikipedia that the production costs of the ps3 is estimated to be approximately $400 as of January 2008. How true this is we will find out in the coming months.

edit- Here is a link

http://www.gamesindustry.biz/articles/ps3-production-costs-halved-says-analyst

An 80G PS3 with no BC should be about $350 to compete with the 60G 360 on price. Assuming the average customer ignores the obvious reliability problems with the Xbox breaking down so often, doesn't care about getting 20G more storage, and has no interest in online play, the PS3 has the following advantages to make it a better choice at a $50 premium:

* Bluetooth controllers (best signal)
* Rechargeable controllers with internal batteries (no need to buy AA batteries)
* Higher capacity media (no disc swapping)