No, that's not what I said.

Making a PS4 doesn't have to be very expensive. If they do it smartly they can avoid PS3-like monetary disasters. They just need to be a little less ambitious in terms of using unproven architectures, using more off-the-shelf components and things like that. Increasing processing power is returning less and less benefits anyway.

PS4 is probably just going be like a slim-lined PS3 but little more powerful and more interactions with the PSP2 or something.

Wow, that's a lot of work you've put into this NJ5. I don't think it would do justice to you if I did not read at least some of your links, so I'll hold off a bit on commenting (at least an in-depth one).

However, it seems to me that Sony will have to cut costs in all their products, as quickly as they can. If they can't cut costs, and aren't making too much on that product, they'll have to outright drop it.

Specifically speaking on the PS3, they cannot drop it. They've put too much money into it, and they have to make it back somehow. They have to forget about being in a "first place" pissing contest with Microsoft, and focus on reducing costs to manufacture the PS3, but NOT cutting the price............they need a profit. Hopefully, they could use a lot of the R&D that went into the PS3, on the PS4, and make a profit that way.

What does this mean for blu-ray? They've already lowered their forecast for that. Do they lower both manufacturing costs and price for the discs, for higher penetrance? Or do they focus on profitability? Do they allow China to make blu-ray players and release cheap players? So many questions.

Of course, if this financial crisis ends, then none of this matters. But hopefully, Sony and all big businesses, learn to operate within their fiscal means.

I guess a lot of people are hoping this will end Sony's current form in the console industry (for some reason), but I don't. The market would be weaker without one of the major contenders and no one would benefit (gamers, that is).
The financial crisis is affecting everyone and everything, that much is sure, but it won't last for many years so the chances of Sony (and other companies of the same size) going bankrupt or having to dump divisions are slim at best imo.

financially they'll be fine they're one of the top if not the best in electronics around the world. Playstation wise they'll be playing a bit of catch up in hardware sales for the next 2 years but will eventually dominate as its sony and at the end of the day no company can match they're exclusives. No matter how close 360 comes this generation they cannot outperform sony as ms is strugglin right now with a system priced at $199.99 and that's its peak point. the arcade console is at $199.99 and ps2 is at $129.99 lowering the price further will put ms to shame.

lol?

Sony will be fine. This financial crisis will blow over, and it will be back to normal in the recent future. Sony isn't going anywhere, and isn't in any position to go anywhere. The Gaming division is still in the black by a billion or so, while MS is still in the read by six billion (?). MS has another seven billion to go before they are doing worse than MS and MS is still here. So unless Sony loses Seven billion bucks in the gaming division over the next year, I won't be worried much. >_>

 Wow. You are so wrong.

Microsoft is currently making money on the 360. About a billion a year. Yes, it lost a lot of money in the past, but that is sunk cost. Looking forward - it is quarter after quarter of profits. Microsoft may regret the costly mistakes of the past but is very happy with the present and future.

Sony on the other hand had a great ride years ago. Made tons of money. But for the last 3-4 years they are losing their shirts. This year it is going to be a billion dollars in loses on the PS3. They are not happy and they don't hide it. They must return to profitability to have a reason to continue the PS3 business.

When Sony looks forward, they don't see that profitability is guaranteed. The competitive situation is tough, their cost structure is horrible and the economic crisis combined with currency exchange rates are making it even more impossible. At some point they must start asking "why are we doing it to ourselves?".

I think he's bringing in the PS2 era into his equation. These are different times however. It really has no bearing on the current reality.

Does anyone have the actual figures of where both Sony and MS are currently for losses in their gaming/entertainment divisions?