On the eve of the U.S. release of the PlayStation 3, with hard-core gamers camping out across the country (and a few of them paying the price for their fotitude), many possible consumers out there are trying to justify spending either $500 or $600 for a new gaming console. This blog entry from The Utility Belt, shows the price could be much higher, and it may not be a bad investment.

According to research by iSupply, Sony will lose $306.85 on every entry-level PS3 it sells at $499, and $241.35 on the top-of-the-line model which will go for $599. As a point of comparison, Microsoft loses $75.70 on the sale of every XBox 360. These statistics may not bode well for Sony in the brewing platform war, but if you look at the numbers from a different point of view they tell a different story. Think about how much Sony is paying to make these machines, and what it's putting into them. One truth about the technology of video games is that the hardware is always ahead of the software, meaning as game developers become familiar with what the PS3 can handle, the games will take better advantage of the platform, and with what the PS3 has under the hood, the games are bound to be leaps and bounds ahead of the XBox 360 and the Nintendo Wii.

If you look at these numbers closely, you see that Microsoft needs to sell a little less than 2 games to earn a profit on XBox 360, whereas Sony needs to sell at least 5 games to break even on the PS3. Bad news for Sony, but good news for the consumer. Look at it this way, Sony's investment in the PS3 is so steep that they absolutely must produce a reliable product. If a console breaks and needs to be replaced by the consumer, Sony's loss widens. If you're on the fence as to which console to buy, this could be a factor, or maybe not, just another thing to mull over while you're waiting on line outside of Best Buy for the doors to open. — Brian Ward

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