If it's true, at $400 they are still loosing money on it.

Well at least it means us early adopters get the better machine for once,but I really would like to see Sonys price list for parts,I find it hard to believe that there still making a loss,sounds like a PR stunt to me

I totally agree...
I'm pretty sure that cost includes the development of the console prior to manufacture.

First time I've heard of downgrading a machine described as 'tweaking'

Also, what they don't tell you is that this reduction in costs more than halfs the life of the machine.

Analysts are speculating that new ps3s could be duds by the summer of 2009. That wouldn't be good PR if you've just spent £300 on one.

This will be interesting to see what happens.

p.s. America tried to make a Ferrari with half the cost once - that gave us the DeLorean!

@5 - But other analysts are predicting 2008 will be the year of the PS3. I've not come across your analysis before "Sony Lemos Dept.", could you perhaps post a link of your source? Would be grateful, thanks.

Until Sony meet my three criteria, I'm not buying a PS3.

Criteria being:

1. Reinstating backwards compatibility.

2. Drop the price further.

3. Bundle the DualShock 3 with the standard console package.

Right guys to prove a point I will open a Playstation 3 TEST machine(don't ask) and my friends 2 day old psx3 and do the math-Yes I have plenty of time to kill,and then send some kind of blackmail letter to japan.I will then take control of the world and you will all love me.

By the way ZED ZEE you should get welfare to feed your kids-oh and No.4-how about if Sony chuck in a special Pampers pack?

ZED ZEE - games quality, good or otherwise not a factor in this equation then?

Zed Zee rhyms with - a pulp fiction character,I think he might be a - person of deep southern heritige- and likes banjos-and his best friend is his sister-and.................you know
(PSX3's are very complicated to open)

@ TORC:

Oh noooo! You're American?! Actually from the US of A? And you know what the "A" stands for - and I don't mean America...

Good grief. I'm from where healthcare is free...Good luck with that health insurance policy...Have you made sure it's valid at your nearest hospital...'Cos some of them aren't, apparently!

@ MrJolly:

Oh, don't get me started on that one! Wow, yes, they have a great deal of work to do there but I think developers are now slowly starting to appreciate how to use the CELL processor.

For example, I'd been screaming on other sites about the reason for the GTA IV delay being that Rockstar were useless at cutting code on it last year - until Sony stepped in and helped them over the past few months (bet they had a poor chap in a sleeping bag at their offices all this time) - but they've now seemed to have sorted things out and it's almost ready to go.

So, I think the good quality will come this year, but you'll always have fantastically badly executed projects.

That's why I want the backwards compatibility there, because it allows me to get rid of my PS2 but still be able to finish my games for it.

But really, games or package-wise, I see nothing of interest for me on the PS3 front at the moment. Although the rumoured 120GB HDD model might well shake things up a little more versus X360.