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Chief of Sony, Sir Howard Stringer, has declared that Sony are set to sell the PlayStation 3 hardware at a fairly significant loss. Now selling consoles in the first year or two at a loss is nothing new for console manufacturers, as the economies of scale in the back end of a machine's life and revenues from software sales provide ample meat to feast on.



However, Sony are using the machine to push their Blu-ray high definition DVD format, to the point that every PS3 will have a Blu-ray drive within it. Now we're talking American figures at the moment, but the price of the PS3 is likely to be around $300 - 400. The launch price for a Blu-ray player alone will be nearer $1,000. Then, factor in the processor and graphics technology, and it seems that - even taking their margins out of the equation - Sony's Excel spreadsheet will be full of the colour red. Lots of it.



Naturally, there's a strategy at work here, as Sony are effectively launching two new hardware products in one. If they can establish both the PS3 and the Blu-ray in people's homes, then they'll be living off the spoils for many years to come. We don't bet on them having too big a Christmas party for the next year or two, though.



Currently, the PS3 is set for release over here anywhere between March and October, depending which source you believe and which scandal-raking Internet forum you choose to read. Our bet is closer to the autumn, though.