Sony is currently in a pickle with the PlayStation 3. Clearly they still can’t make a profit from the console. The PS3 has been at its current price point for a long time, and despite intense pressure, Sony is still reluctant to drop the price. Despite the argument that a Blu-ray player is included with the PS3, the package is starting to seem overpriced. This is even more the case when you can get a separate Blu-ray Disc player for less than $150. The PS3 gives you some extras that the competition charges for, like built-in Wi-Fi and free online gaming, but not all console users require such features.

In addition to the lack of value that the PS3 presents, the continuing rumors of an impending price cut will surely prevent potential buyers from picking up a PS3 in the near future. Therefore, Sony has to lower the price to attract new customers but lose money in the process, or leave the price as it is and lose a minimal amount on each console. Although the latter strategy would result in lower sales and therefore a smaller total loss, the risk is that they could lose customers to their main rival, the Xbox 360. This could be too hard a blow for Sony, as it would lead to customers to switch sides. ‘ to a Microsoft product and once this has occurred, they are notoriously difficult to recover.

In addition to the above problems, the biggest problem for Sony may be just around the corner. This problem could take the form of a new Xbox game console. Such a release would surely be the worst possible news for Sony Corporation. The excitement of a new console and the increased sales it generates would not only drive consumers away from the PlayStation brand, but would also firmly cement the current group of Xbox 360 gamers in the Microsoft camp. Microsoft would do well to learn from Sony’s mistake and include full backwards compatibility with previous Xbox games to ensure there is no discontent among longtime fans. Such a move by Microsoft may cause a drop in sales of PS3 games and cause developers to stop developing Sony to focus their efforts on the new console from Microsoft.

The fact that the PS3 is difficult to develop will only hasten the potential for this to happen. There’s no solid word on a new console from Microsoft, but if such a product materializes within the next 20 months, Microsoft could do permanent damage to Sony’s gaming division and the PlayStation brand. This would surely be a blow to consumers, since a Microsoft monopoly on the game console market (as they have done with the operating system market) would not be a good thing. Let’s hope for the sake of consumers that Sony’s gaming division manages to turn their luck around.

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