If they were the same price that would work but as it stands most everyone would take a PS3 as its worth more! Now if its an xbox 360 Elite and a PS3 then maybe that would work :)

Or a free Wii or a free $600 PC and they will probably choose PC Wii PS3 and Xbox 360 in that order.

Price is part of a product, not an excuse. As long as the 360 sells more than the PS3 it is more wanted. Period. Damage control isn't required. If the PS3 wants to become more wanted, Sony should lower the price, instead of complaining about the competition's price-point being too low.

or since both were cheap they could have done both, dont buy the party line, this was a money grab plain and clear, other wise it would be user replaceable, or 3.5 , and by now much larger sizes and cheaper, hell 6 months ago i bought a 500 gb 2.5 for less then 80, and 120 is still over 139, that dosent fly, i can stand gouging say 79 for it, but its current price is retarded hell id pay 150 for a 500 gb  maybe 160 

I'd say that in the eyes of most people they're equivalent systems.

So the question becomes:

Is BluRay worth an extra $100?

So is it to you?

299 vs 399

I love how you guys always use the arcade pricing when it fits your argument.  The pro is more comparable.

Arcade would be the last model id buy.

Edit: Although, the first Arcade models were lame. The control was wired and there was no HDMI.

Squilliam said (bold):

Does this sound reasonable?

 Yes, I think there could very well be an inherently higher production cost thanks to IP. I was just wondering aloud if anyone knew what the possible specifics were or if there wasn't some obvious, plausible architectural constraint that I was overlooking.

I understand that you know 30* more than me!

lol, that's right squilliam go right for the ego, you'll have me back in redmond's camp in no time :P (seriously though, thanks for the compliment)

Blu Ray playback license will likely always cost between $5-10 (My deviant word I never spell right)

This is plausible, although I would be surprised if they didn't manage to get a special rate from the consortium. At the very least I would expect which ever group at Sony given sway over Blu-ray to have to front the bill for it, at least in their internal accounting. If they use an internel currency (pretty much identical in design and function of the rouble in the Soviet Union... seriously) for interdepartmental resource allocation like IBM and Microsoft -- I only mention these two because I am familiar with their schemes -- it could easily be that SCE's blueray costs are being subsidised. This wouldn't show up in Sony's fillings, but it would be considered reality at Sony. This would also explain why SCE seems to have come off pretty unscathed in Sony's company wide belt-tightening, since the cost of the PS3 to Sony as a whole wouldn't be the same as the cost to SCE.

For the XD ram/memory controller royalties along with increased cost due to it being more specialised.

Rambus would be my first guess for IP related PS3 costs being higher than the 360s as they are notorius in the industry.

For a compulsary HDD in all models, especially considering the number of 5GB installs. Microsoft could get away with much cheaper slow flash without a specialised controller and thats just for DLC and Arcade games.

True enough, but how much that is going to matter is going to be a function of how many new fab processes we are going to see before the systems end of life. The 8Gb usb flash drives on froogle seem to start at $10. Wholesale bulk prices for just the NAND chips should be at least a little bit cheaper. Not sure if 8gb would be enough to support the bare minimum on the PS3, but the point is we are a 1 or 2 shrinks away from the point at which adding minimal, functional flash storage is almost a non-cost. I expect the 360 entry level models, possibly even coinciding with the release of NATAL, to eventually go this route also.

Nvidia RSX royalties. It was a significant enough expense for Nvidia to mention it in their financial report and its paid per PS3 made as Nvidia mentioned it in their financial report in reference to lower than expected PS3 sales. Also they may not be able to combine the RSX and Cell on the single die as Nvidia may not want another company snooping around on their chip. A leaked Xbox 360 roadmap indicates that a combined Xenos/Xenon is on the cards.

The royalties may be expensive, but I highly doubt Sony forgot to guarentee their freedom to migrate to SoC as the generation progresses. Their is also no way Sony doesn't have access to the Verilog/VHDL code, although there should be no doubt that everyone who walks within 10 feet of it must sign 10,000 NDAs in blood.For a more complicated PCB as they have dual 128 bit buses so they will likely need a larger board and or more layers long term than the Xbox 360.

For a more complicated PCB as they have dual 128 bit buses so they will likely need a larger board and or more layers long term than the Xbox 360.

I don't know that this is or isn't true. Even if it was for the current micro-architecture, in any future cheaper design the system merely needs to function as if there where "dual 128 bit buses".

The Blu Ray player will likely always be at least a little more expensive that the DVD player in the Xbox 360.

I disagree here, I think the opposite is likely in the limit for the Blu-ray player in the PS3 and the dvd player in the 360. The later must have a motor capable of spining the disk at a much higher velocity than the former. The new diode in the blu-ray drive is a solid-state device. At least in recent history, Solid-state devices tend to fall in costs on the timescale of months, whereas advances and cost reductions of mechanical devices tend to happen over decades.

They don't own the Cell patents so they must also buy the chip rather than have it fabricated on contract.

I think the IP Sony sold to toshiba was for the next gen cell and the actual fabs which they built back in the halcyon days of 90nm when anyone could have a fab in their garage :P. Even if they didn't, I doubt they wouldn't have negotiated a clause to use it with the PS3.

There are only three groups with 45nm fabs: Intel, TSMC, and a consortium of everyone else led by IBM which drefrays the costs of going 45nm all it's members. TSMC had to drop high-k metal gate tech from their initial plans without which 45nm is of marginal value and I'm not sure if Chipzilla even lets 3rd parties use their 45nm fabs as their fab lead is main advantage of their chips. So that leaves only IBM's superfriends group as a potential fab for both Sony and MS.

Also they don't get those lucrative Xbox Live revenues.

True, nor do they have nearly as good of a perpheral racket going on.

PS. I can't spell either. It's an out of date skill like translating morse code :P. However, as of vgc 2.0 I have yet to find a computer on which the spell checker actually works... and I'm too lazy to do it in another app :(

its more than just the price...lol