Nvidia didn't help, but I thought the HDD cost was the real issue they had - apart from the install base that is.

Xbox was basically costing too much as a unit vs the HW and SW sales and MS realised they had to go back to the beginning again.

Yup, it looks like Ps2 will end at ~ 72% (140M out of 195M)

The previous generations stand at ~

NES: 82% (60M/73M)

SNES: 52% (49/95M)

Ps1: 65% (102.5M/155.5M)

Ps2: 72% (140/195M)

So the Wii will not be as dominant as the Ps1 (it would probably need 200M to do so, assuming Ps360 = at least 100M, which they will) meaning that the Wii is the 2nd least dominating console so far.

This gen is the closest yet

Edit: Oops, wrong quote

The assumption that the PS3 and 360 combine for sales of 100 Million may or may not be that realistic anymore ...

In order for them to hit 100 Million they would need to maintain their combined sales numbers for another 3 years; this is not impossible, but we will see the release of two new handheld systems in that time, be in the the middle of a very bad recession, third party support will continue to shift towards the Wii, and many of the selling features of the HD consoles will become inexpensively available elsewhere.

Do you have a source for this?

Since the profit of the gaming division is so low it is hard for me to accept that the PS3 SW is covering PS3 HW. That would mean that 100% of the profit is generated by both SW and HW for PS and PSP which is then rather low.

Otherwise you are right, Sony is of course cutting cost by improving production. But looking at the numbers it shows that that progress hasn't been fully working. MS only has 1 console nad still produces more profit on gaming then Sony does with money taking PS3 and 2 profitable consoles.

Sony did a great cut in expenses with the 40gb version. Cutting PS2 hardware, no card reader, SACD, 2 less USB and so on and most of them where features that the big majority didn't care about (not PS2 BC then). But for the next price cut they don't have anything else to cut down on and has to lean on that the productions costs of remaining hardawre gets cheaper.

My theory is that they have to cut but they donät realy want to due to position the company has finansicaly. 

I know that the main issue for MS and Xbox 1 was both nVidia and Intel producing and owning the chips in Xbox 1, combined with HDD prices.
But doesn't Sony own the RSX? I'm pretty sure that they bought the chip from nVidia as a late solutions after GPU CELL was in the bin? It says Sony RSX on the chip, in Xbox 1 it said Intel/nvidia.

* edit. Sony owns the rights of RSX, it was co-designed by nVidia but just like Microsoft owns Xenos from ATI. The difference was that Sony produced RSX in their own fabs which was sold to toshiba this year.

Very good point. PS3 and XBox 360 may not reach 100 million sales combined. However Wii would pick up more sales and grab more market share as the two HD consoles dwindle in sales numbers over the next three years.

The market leader tends to accelerate its margin over its competition as time goes by. NES, SNES, PS1, PS2, and DS have all proven this theory.

The sales of the PS3 and XBox 360 are expected to decline in the next three years. Wii sales rates will sell at an equal or faster rate over the next three years.

Are u sure about that? MS will hit 99 dollars with arcade within 2 years and all models under 199 dollars. Sony will also be down round 199-249 dollars.

looking in history moste of the sales of each machine is when prices are lower the 199 and 99.

Yep, quite right, but you have to take into consideration that both Wii and SNES came out on the market a lot after the the competitors, yet they managed to regain the leadership.

Actually Wii is doing way better than SNES which regained the lead only once SEGA lost his mind over too many different projects!!!

The other platform you are citing started way before the competitors did, as NES came out alone and 2-3 years later came Genesis (Master System never was in the game) and PS2 had a 1,5 - 2 years lead over MS  and Nintendo!

As for PS1, Saturn pratically never existed and N64 came out a year and half later!

Sorry, I went through internet and did some research and turned out you are right about the GPU's matter!!!

So, my theory crumbles there!

But this would also mean that PS3 still is expensive to manufacture!

While the HDD definitely cost MS some money, it was Nvidia that drove the Xbox to an early grave. After all, lawsuits were filed over that entire mess. I don't think Intel was quite as big a problem, seeing their history and close ties to MS.

IIRC, the Xbox HDD was a standard 3.5" unit. Sure, it added to the cost but they could have bought them from anyone, anywhere. They weren't stuck in a terrible contract like they were with Nvidia and their GPU.

The thing is Sony has been having a bad year as a whole company. The PS3 is definitely feeling the effect of this economic crisis. I hope things will look better for them in 2009. Next year, they actually has some good exclusives for next year. I just hope they will rise again.