And they lost how many billions to win that format war? The PSP is the only trully reliable system for a profit at this point for Sony, and they are fucking it over just to save their home console... Nintendo was saved by their handhleds during difficult times, maybe Sony could learn from them ;)

Yeah, PS3 will be profitable at its current price well before the holiday spending frenzy. I reckon it's already breaking even, or even marginally profitable (like 5 bucks or something). A $100 price cut in November will drop it back to unprofitability, a $50 cut may not.

In one sense you can say anything Sony sells at a profit is cross subsidising any PS3 price cut, so in that respect PSP GO will be no different to anything else. Saying that Sony is inflating the price of the GO specifically to fund a PS3 price cut is pure speculation. Find me some evidence showing that the PSP GO would have launched at $199 if the PS3 would still be a profitable machine at $300 then you can start bitching. Or are you suggesting the $50 surcharge is to cover historical PS3 losses?

On this I will agree: PSP GO is a rip off and totally overpriced, compared to the PSP 3000. But who does Sony see as the competitor for PSP GO? Going smaller and with a smaller screen it seems to me like they want to go head to head with iPod touch. Compared to iPod touch the launch price of the PSP Go will be $25 cheaper than the current (2G) 16Gig Touch on Amazon. If Apple need to sell a 16Gig MP3 player at above $250 then why do people think the PSP GO is overpriced at below $250? I have no plans on owning either because I think both are too pricey. I also think Sony are mistaken with their PSP GO strategy, but time will tell. If there is a big profit margin on the PSP GO then there is scope for Sony and retailers to put together some nice PSN credit packages at the $249 price.

Unfortunately I think the PSP GO will be over $500 here and that is simply way to much for me.

If he was a good anylist shouldn't he be basing his numbers on the official Sony press confrence after the FY financials were released. Where the CEO stated about 10% loss for each Ps3.

he said that is loss with a US$50 price cut

The only money they would be losing after slashing the price is from the people who would buy the Ps3 at the higher price point anyway.

Also if you introduce the potential PS3 Slim (that would have considerably lower production costs)) then things get interesting

It does't matter how much the drop is.

so they are lossing US$40 per console, add US$50 to that and that would the a US$90 around what the go can profit

You re completly wrong. First of all you are basing your numbers off of retail and not for what sony sells it at.

Trust me Sony will be making more then $15 on each PSP Go, also this is not for the PS3 either, Sony can afford a price cut with the PS3 due to the smaller chips and a bit a redesigning. Sony just wants to make a lot of profit right now so that there losses will be paid back.