Clearly the people at Sony are not stupid. Clearly they are aware of their costs and their margins. But they seem to be overlooking one simple fact... critical mass. There is a point in any console generation whereby a winner is decided. It's not decided by GfK, or NPD. It's not decided by the platform holders. Its decided by popular consensus. And once that consensus is made, the loser is just that. The loser! And no one wants to back a loser. So after that point the loser's sales take a nosedive.