I think this point is underestimated.  Too many SKUs can and will confuse some folks.  I'd much rather go back to the "You make one console and throw it into the ring" model.  It's easier to work with from a customer standpoint and easier to work with from a developer standpoint (aka everyone developing for a Wii knows exactly what hardware will be playing their games).

Well it seems Microsoft caught the stink first. They brought up the product, and introduced it to the public. Why 40 GB well chances are they found a good deal from a supplier. How many PCs in the coming years will have 40 GB drives. However I do not see them introducing this sku till next year.

Financially it would be a very bad move for Sony to release it during the holiday season. Since Microsoft knows its coming they probably already have a counter price cut on the shelf just in case Sony tries it. Sony really has no games that are going to push the console, and if Microsoft cuts prices again they will just reach more consumers that much faster.

There is a upside to a cheaper unit come next spring when budgets are far tighter then during the holidays. Still its a price war, and Microsoft was brilliant divulging the units existence to the public it has to have driven down sales.

However having four skus is rather disconcerting for any person betting on Sony. They would not be doing this if they were not feeling threatened and desperate. I keep expecting Microsoft to discontinue the core sometime after this holiday season is over.

For a consumer ordering one or two disks at a time this may be true. But if you're ordering 3 million at a time, it is not.

If I had to guess -- and this would be pure speculation -- I would say that the manufacturing costs for 40GB and 80GB drives (laptop or desktop) would be approximately the same. There literally may be another platter involved with the 80GB production of a laptop drive, or perhaps a different process (perpendicular vs parrallel). If they can fit 80GB, or more, on a single laptop platter, then a 40GB version would have half, or less, of a usable platter when measured by area.

Either way, disks are very cheap to manufacture and would cost approximately the same. The biggest reason they'd go with a smaller disk is to denote an inferior product -- ie: the 80GB model > the 40GB model.

We can't judge a move like this until it actually happens.  Financially, perhaps it may be a very high risk move for Sony.  But Sony has been liquidating to make capital available to produce these bastards and sell them by the holiday.  If they don't make the 40GB version available by the holiday, they may be giving the holiday to Microsoft which would be a significant event in this stage of the console war.  If they release it and sales go through the roof during the holidays, it will have been successful regardless of how much money Sony loses in the short term. 

From Arcturus' news link:

"It has been suggested that a few, more minor features, such as the console's USB ports or backwards compatibility might be lost in order to let Sony offer the model more cheaply."

AAAHAHAHAHAHAHAHAHA

Hardware backwards compatibility is already gone, and software BC is SOFTWARE i.e. not built into the hardware.

USB ports are needed to charge the PS3 controller.

Meanwhile, things that could ACTUALLY be removed, like wireless internet and the card readers, are not mentioned.

if sony puts out a 40gb sku, then it's more likely to be a shell game... where average joe consumer sees a smaller HDD and a cheaper price, but doesn't notice the removal of wi-fi, card readers, maybe 2 of the 4 usb ports... the 20gb skus were not popular anyways, i don't know if this would be a good idea???

Could a smaller HD save space even if it can't save cost?  Maybe a component in a PS3 slim?

Theoretically, no it does not cost as much, but the difference wouldn't be that much.

-if- and this is a big if, Sony can aquire off the shelf 40GB HDD's or has an assembly line that produces them in house then yes 40GB would save a bit of cash per unit but no way near 100$.

In addition why would they remove backwards compatability? That's done with software at this point.. they patch it with firmware updates(correct me if I'm wrong), if they removed it, they'd have to do 2 seperate firmware updates or risk anomilies. It'd cost more rather then save them money..

Long story short, in theory YES 40GB < 60/80GB in cost if they don't have to open a production line to do it.

Argh. wrote something but error when i "post"ed it. anwyasy, i was saying 40gig doesn't have ring to it. if they new 60gig (without emotion chip to cut cost), at $399, that would be good too. But having 20, 40, 60, 80 is too many console skus. when 80gig drop to $499, will it still have motorstorm for free?

also, anyone hear of Sony/BDA will extend the free 5 bluray movies offer beyond sept.30th?

I miss the days of deciding which packin you wanted with your system..... and as for sony and skus, they should have just eaten the cost over hardware emulation and poked fun at ms for its.... hopefully sony has enough sence to never try one with out an hd installed ....damn core from ms is a disaster..... also due to the low volume of 40 and 20 gb hds they do cost more now, even when bought in bulk, go out and look at the costs its not that hard. that is one reason i have wondered why sony bothered with a 20 and ms was a big enough dick to still use one.

I read an FCC report, there was supposed to be a 60GB and 20GB w/o an EE but they of course werent released. Also the changes seem to be to the Wifi and BlueTooth adapters, they have been improved a touch. Also the changes make it so that theres less electricity used.