It's probably too early to analyze the whole situation, but I agree with HappySquirrel in that it's definitely not too early to view the launch and first year as a failure.

Maybe PS3 will turn it around in the long run, but I don't think even Sony believed that PS3 would be in third place for most of the first year only to come back a couple of years later.

As for why it failed, certainly things like price and lack of games are worth considering, but what was it that Sony did to lead to those things? I mean, no company plans to launch a game system at a price consumers won't buy and without any appealing games...you make mistakes along the way that cause that. What were they?

For that matter, a weak game lineup is pretty much par for the course in every system's first year. I admit that PS3's holiday season is looking so-so, but from January to September, the first year is bad for any system you can name. In fact, if it wasn't selling so well, we'd all be blaming lack of games for Wii's failure.

 Thanks for making me spew diet coke all over my keyboard! Your analogy is quite barbed!

 diet coke is for women

coke zero is for teeh menn

or, that is what coca cola wants us to believe. 

 That doesnt says much :? BTW nice PSP collection , all quality game ;)

 Amazon is usually a good indicator of how books are selling. And yeah, those are my favorite PSP games. I am very happy that the PSP has a bunch of games that entertain for hours on end. I find it a very amazing library.

Well... Then I guess it's time that I write up a book and title it "How the Wii Failed".

No, not about sales or the hype. But how it failed the gamers who strive for games to push the limits of the systems potential.

Yea, I know, it's silly, but not any sillier then a book asking why the PS3 failed and it hasn't even been out a year yet.

This is a solid analysis of the situation.

No one in the world would have predicted the PS3's current status if they were predicting pre-E3 2005.  Even up to the PS3's launch, very few people would predict the PS3 would do as poorly as it has so far.  From that perspective, there's no way you can't consider the PS3 a miserable failure so far -- it started the 'next gen' with the foregone conclusion of dominating this generation.  And it has gone from there to "will it pass the Xbox 360 and avoid last place this generation?" with no strong prospects for generating a profit in the first few years.

If you consider what momentum does for you in an industry as monolithic as the games industry, this is almost unbelievable.  It commonly takes developers 24-36 months to release new games, and in the 10 months since the PS3 and Wii have launched, a slew of developers have shifted development efforts away from the PS3.  If the industry was more agile, there'd be far fewer games on the PS3 right now than the meager offerings it has.

I don't think the PS3 has failed, the thing costs $600, did they expect it to sell better then a system priced at $250.

 From what I have gathered it is about how it has failed during the launch period. It was supposed to sell faster than any console before in history. It had the potential to do so. The potential could be seen during the Launch chaos that ensued for the first 3 weeks but it fell pretty damn fast and it should not of. It may come back but it is unlikely and irrelevant to the topic of the book. Trust me I am sure people at Sony are going how could we have done this launch better and if nothing else it is a spectalur stutter if not fall.