Acclaim big shot David Perry believes that Sony has dug themselves into a huge hole this console cycle, selling a machine so expensive to produce that they will never recoup losses. Perry, always one to deliver a juicy sound byte, said the following during his keynote at GCDC yesterday:

"Because of the cost of making the Playstation 3 and because they sold it at a loss, Sony basically has pretty much no chance of making money on the PS3, because it’s lost more money than they made during the entire peak of the Playstation 2 - it’s not going to happen again for Sony.

"If they release the Playstation 4 and have an even more expensive console and raise the cost of games by ten dollars, that would not be good."

Perry went on to note that the reason that Sony is committed to a ten-year lifecycle for the PS3 is not because they believe in the product that much, but rather because it will likely take them at least a decade to start turning a profit on the costly machine.

Perry’s points provoke an interesting argument: did Sony become so intoxicated with the success of the PS2 that they overreached a bit when creating the PS3? Did they craft a fatally flawed console plan by banking on making an ultra-expensive machine, slapping a Playstation logo on it and assuming it would sell? While Sony has dropped the price of the PS3 to something a bit more reasonable, every time they slash the end cost for consumers they take a bigger hit in lost revenue for every console sold. In a great irony, the more PS3s Sony sells, the worse their financials look. Funny how business works isn’t it?