What bothers me the most is that someone that calls himself an analyst is advising a division that has taken close to 4 billion in losses to make even more losses and says it will benefit the shareholders.

BTW if they do not cut the price for christmas they are stupid. Nobody can tell me that the mighty Sony with all its experience in manufacturing of electronic devices is not able to have an entry price that is less than twice the entry price of its direct competitor who offers a console of similar power albeit with less bells and whistles.

But how can you say this?

Don't you know CNet knows all there is to know about running huge corporations?

Please don't bring the truth to the table.

didnt bother reading too long but man i know that cnet is bias towards xbox360! did anybody watch their show long a go where they compared the Elite vs the low end of PS3 and was saying how the PS3 lacked this n that yet they didnt even do a proper comparison. This was when the high end PS3 was like the same price as the Elite so i dont understand why they compared it with the lower model. (They just wanted to bash the PS3) ..this is all my opinion of what i got out of it when i saw the show so no hating on me any of you Cnet fans.

You have to spent money to make money, as they say.
At each PS3 sold they earn money, on Blu discs, on peripherals, on games(duh), on PSN. So they need to sell more Ps3. Is that simple. Face it like a Cell phone company pratically giving cell phones in order to secure a user base(they do that in Brasil, I don´t know if they do it in other places).
In the future, they will probably manufacture the pS3 at a cheap cost and sell it at a profit, but rigth now they need to sell software to cover costs and that require HW.
Sony will not close it´s game division, the article fails on that, but the guy is rigth claiming that a price cut would benefit the company.

"If Sony really wants to do the right thing and address its issues, it needs to drop the price of the Playstation 3. It's as simple as that. I know Sony will try to make a cockamamie claim that by dropping the price, it will operate at a loss and lose even more revenue, but let's be honest with ourselves: every single console maker sells consoles at a loss for a while and once it hits critical mass in its production cycle, it can operate at a profit.

Usually, that plan works. But when Sony shipped a console that was too expensive at the onset, it backed itself into a corner and was forced to maintain a price that's simply not conducive to growth. And now that component costs have dropped and Sony can afford to drop its price, it needs to. The game right now isn't about profits, it's about increasing its userbase to eventually yield significant profits at some point in the future"

The key here is long term and userbase.

Everything is ok in sonyland. Nothing has changed, PS3 is still huge. Theres only lots of sony hate everywhere. Just ignore the hate and PS3 will succeed. PS3 will be the greatest console in this generation and it will sell much more than X360 and wii combined. No sites can be trusted they are all liars.

/Sarcasm (If you really didn't see it... :P)

@aavidbacon
Sony netted $200 million in last quarter (Thats all blurays & flatscreens and everything...) and sonys gamedivision lost $400 million(Theres stuff that make money in there also, but the losses with PS3 were even more HUGE! so in the end they lost HUGE! amount of money anyway.).

You should realize that if the price of the ps3 drops, its double-whammy for sony. Why? Because the they'd be selling more consoles with each at an even higher loss. If they drop the price by just $50, each new ps3 owner would hve to purchase at least 6 games with it to offset the new loss not counting the old one. Their other divisions are also currently bleeding money so there won't be anything to fall back on.

Do you want sony to collapse and have M$ as the last bastion of core gaming? I'm hoping even xbox fans would answer NO to this question except they've all enjoyed the M$ monopoly on the OS market. Vista for $350, now thats a steal.

Clearly written by someone with a position that does not include holding any SNE shares. When a global recession, reduced consumer spending, and a strong yen all push your stock price to 15-year lows, you have to look for carrots to appease the shareholders.

As for the PS3 price issue, it's doing perfectly fine without a price-drop. Unless the figures in the vgchartz non-cumulative weekly sales data are wrong, the PS3 has outsold the 360 approx 40 of the past 52 weeks. Using this weeks figures as an example (where the 360 has just recently overtaken the PS3 again), the 360 sold 178.6K units, while the PS3 sold 158.8K units. So of the total units sold between the two, MS had a 52% share and the PS3 had a 48% share.

No. SONY isn't slashing prices and going back to selling the hardware at a loss to make-up 20K unit sales per week right when the thing is finally going to hit profitability for Black Friday 2008. Unit and game sales will have the division back in the black again in the next Q, then SONY will look at escalating price cuts through 2009 to sell units and drive manufacturing costs down.

Sony is doing just fine without a cut. Too much comparison is made regarding the success of the PS2 in comparison to the PS3. Nintendo came out of left field and appealed to a massive audience and is doing awesome. MS was first in this Gen, built a great library of games and support, and has the best on-line service (IMO). The PS3 is a great console, and though mistakes were made, Sony will be just fine in the long run!