They have been bleeding marketshare. As Sony plummets, Blu Ray sales go up.

You lost me on that one.  Are you saying the PS3 is bleeding market share to the 360 or to standalone Blu-ray players?

Sony isnt bleeding much, if anything they lost maybe .4%. This year they gained about 8% off the 360. They are fine.

No...actually it's at the hands of the Wii and Microsoft is just holding them down. Sony sacrificed the system for the survival of Blu Ray. It was a fair trade off you see, because as I said...they expected losses from the very beginning.

Just wait until they drop the PS2.

Actually they expected massive loses, same with Microsoft, but both expected to be selling about as well as the Wii is now. Basically the Wii killed the PS3 and 360.

I think what Bod is doing is working off of the general economist theory that

"Perceived value is the only true value."

Since value is judged by what people will pay for it... the real value of something is it's perceived value.  Which means that two identical products could be worth a different amount value wise just because of the location of the product or brand or whatever.

Which, i must admit does have a logical simple approach to it.

 Correct. In fact, that's why we have two separate words to approach this with: value and cost. Cost is a literal word, describing the total amount of funds required to create a product. Value is the amount people are actually willing to pay to own this product.

Consider, as another extreme example, a computer that has an internal casing constructed entirely out of diamond. Such a computer would cost hundreds of thousands if not millions of dollars. However, to virtually all consumers, that additional benefit (a Diamond casing they don't even see and provides no benefit) is almost entirely lacking in value. Such a product would never sell, because it's literal cost so greatly exceeds its percieved value by most consumers.

Similarly -- but as a much less extreme example -- there are many things inside the PS3 that clearly cost a lot to produce, but are not nearly as valuable to consumers. It's possible that is Blu Ray. It's possible that it's the graphics processing. Whatever the cause, the PS3's perceived value is lower than its cost. But it isn't because people won't buy things for 500 dollars: people buy 500 dollar PCs all the time, and as stated, people would positively JUMP on a 500 dollar new car. Or a house. Or a 70'' Television. Or even an iPhone, when it was 500 dollars. Because people believed those things were worth 500 dollars worht of value.

Apparently, most people do not believe the PS3 is worth 500 dollars worth of value, despite the fact that it may cost more than that to produce.

"value" is different to every person.  For many people, 160GB has no more value than 40GB -- especially people who don't plan on going online, people who don't wnat to use a lot of HD space, or people who will use a ton of HD space and need to replace the HD anyway.

For some people, having an extra (or first) BD player isn't a lot of added value either.  BD movies themselves are very expensive, for example, so I know some people who buy DVDs instead of BDs.  The only BD player owners I know right now are PS3 owners though.

So while Sony can argue that the PS3 has a good overall value, it only has that value if you want every thing the PS3 has to offer.  If, like most people, you are only interested in a subset of the PS3's capabilities then the value for those people changes significantly.  If all you want is a game console then the fact that it is also a BD player is valueless to you.  if all you want is a BD player, then the fact that it plays games is valueless to you.

You can't argue against that.  it's just something to understand -- multi-usage devices do not have the same value for every type of consumer.

I would definitely agree that most people don't see $500 of value in the PS3.

I think they should offer this for $449 and cut the price of the 80GB to $379.99. I think that would have a decent effect

but that won't happen and I really question how well this bundle will do when you can get a Arcade 360 for $300 less. (although I would never recommend someone to buy it) As you can get the 60GB Pro for $200 less then this bundle and even find some 20GB Pro's for $249.99.