When Sony released the PS3 in November of 2006, it came in two sizes: a 20GB version for $499, and a 60GB version for $599. After doing a teardown of the system and pricing out the components, it was discovered that the 60GB PS3 was costing Sony approximately $840.35 to build, and the 20GB version costing $805.85. The 20GB version was losing Sony $306.85, while the 60GB version was losing Sony $241.35, and the 20GB version was quickly and quietly discontinued this past March, a mere 3 months after its release.
Sony dropped the price of the Sony Playstation 3 (60GB) this weekend down to $499, discounting the PS3 by $100. In addition, a purchase of a PS3 will also get the purchaser via mail-order 5 free Blu-Ray movies (which aren't great movies either -- definitely B-list movies).
In August, Sony will also release an 80GB version of the PS3 for $599. In order to entice people to buy the 80GB version, they've packed the 80GB PS3 with the retail version of the game "MotorStorm". MotorStorm isn't exactly a great bonus, as it is an online-only off-road racing game, which isn't exactly "killer app" material.
Here's a quick look at Sony's competitors:
XBox 360 w/ 20GB: $399
XBox 360 w/ 120GB: $479
Nintendo Wii w/ Wii Sports: $249
The cheapest Blu-Ray player you can buy right now is $500, making it roughly the same price as the PS3. If you're buying it to play games and watch Blu-Ray movies, the PS3 is probably a bargain. However, as a high-definition format, neither Blu-Ray or HD-DVD have really made much progress, as most Americans still find replacing their current CRT with a new HDTV to be too expensive. For $500 you can buy a system that no one wants to develop for, and a movie player that may or may not win the HD format war. I'll wait a few more years yet until the PS3 has something that I might actually want to play, and when the victor of the HD format war has been determined.
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