Well I'd imagine 6 Million by August 2007 was their worst case, in reality they were aiming for 10+ Million or even more.

Still "standing on its own" the PS3 is still not a failure, the war is still in its infancy :)

When there are a couple of price cuts within 8 months, that's desperate. I don't know if that really counts post-launch price cuts, because I've seen those in under 6 months on GameCube, Xbox, DS, and even Super NES.

The definition of success is always hard to determine. I would argue that any console that loses money is a failure, but then Xbox / 360 arguably did fulfill Microsoft's goal of blocking Sony in the set-top box race, so it is a success.

I would say by the standards of the companies that are making them:

- PS2 was a success
- Xbox was a moderate success
- GameCube was a moderate failure...it made money, but it lost even more marketshare

- Xbox 360 is a moderate disappointment so far...hasn't increased on the Xbox 1 userbase significantly or made a proft
- Wii is a huge success so far
- PS3 is a big failure so far...major marketshare loss, and it's losing a ton of money

 Not entirely, but that doesn't make price cuts desperation or jokes. 

I would say that it would be a desperate move if multiple price cuts come in an unusually short period of time; for example if Sony reduced the Price of the PS3 again after christmas because of poor holiday sales.

I don't think it ever really becomes a joke though...

I don't get the question... since when something that happens everyday on every market turns out to be something desperate or a joke???? It's none of the above.

 DING DING DING DING! We have a winner.

Price cuts, and to a certain extent market share, do not matter to companies.

What matters is profit, and neither Sony nor Microsoft are making money and as they resort to price cuts to maintain sales they'll lose money.

Compare and contrast Nintendo. Nintendo lowers prices only when they can afford it and always makes a large margin on software and hardware and so has always made money.

What I find a joke is that Sony lost money when they had PS2 (most popular home console ever) out against no serious competition. What happens when PS2 and PSP sales fall? Where will the money come from?

Microsoft... well $7,000,000,000 is a lot of money to lose on a loss leader strategy.

@HappySqurriel: Then... What would you call the 360 Core pricecut in the US (compared to the Premium new price)?

@CouchMonkey: Well, i wouldn't call Xbox any kind of success. And besides, looking at sales numbers tells you, that it's not 360, which is blocking Sony in the set-top box race.

Although now I'm curious. Does anybody know, or is there any place where I can find the history of the MSRP of consoles? I couldn't find anything on Wikipedia, and evidently my googlefu is weak on this subject.

The gamecube can be considered a success because it was profitable.  This is the very definition of success that business lives by.

The original Xbox could possibly be considered a success by some other measure.  Perhaps you could say something warm and fuzzy (but bullshit) like "It was a success because it broke MS into the market".