I'm starting another thread only because 5 page threads are huge! I wanted to point some things out that didn't seem really mentioned: If any of you remember the PS2 launch with the horrible lack of hardware volume you will also remember the craze. People were paying between $600-$1000 for a PS2! I too think it would be ridiculous for Sony to release a console above $400 - BUT if Sony saw the PS2 craze (or even worse, purposefully created the shortage to begin with) then they KNOW people will shell out that kind of money for it. Also, Sony has gone on record saying they want the PS3 to be for much more then games. They are targetting the home tv computer market and using the Playstation brand to do it. Perhaps you've seen the "PSX"? It was a special home computer system based on the PS2. Only released in Japan. Several people mention a possible 10-year life cycle for the PS3 and that is accurate. Sony has said this several times. Industry standard life cycle for a console is 5 years. Sony is aiming for a life cycle double that. I believe this is another reason they are willing to not only invest more money in it, but also pay for huge production costs - even sell it at ridiculous prices. Why? The early adopters obviously DO pay such amounts - especially in Japan where Sony is King. Also, If they plan a 10-year life cycle they could be thinking that at the start of the second cycle (in 5 years) there system would then be in the $200-$300 price point.