Sony PS3 to Sell for $399, Cost $494 to Make

According to a report, Sony will lose more than $1 billion on hardware during the Playstation 3’s first year on the market. While the next-gen console is expected to sell for $399, each PS3 will cost Sony approximately $494 to make:

Given that Sony’s PS3 will face stiff competition from Microsoft’s Xbox 360, the chances that Sony will release its console at its production cost is slim. Under the assumption that the Xbox 360 is expected to sell at around $299, Merrill Lynch Japan predicts that Sony will sell each PS3 at the price of 44,800 yen ($410) in Japan and $399 in America. That would mean Sony would suffer a loss of more than 130 billion yen ($1.18 billion) during the first year of the PS3’s release.

GameSpot