And it means PS3 will be one pricey console. CNET dissects the PS3 and compares the cost per component to Xbox 360.

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Sony doesn’t officially comment on the price of the PS3, but there’s a healthy amount of educated guesses out there, and they’re all very expensive. Merrill Lynch’s highly publicized estimate put the cost at $800 — a little high, some say (or out of the park, says Sony). But either way, this baby is costly, and CNET breaks down why.

Turns out the big difference is the Blu-ray disc drive, which is brand new technology and way more expensive than the standard DVD drive the Xbox 360 uses. A regular DVD drive costs $20; the Blu-ray drive costs between $200 and $300. Whoa!

If you use the low-end figures for Cell ($150) and the Blu-ray drive ($200) the PS3 materials bill comes to $700. The high estimate, including a $230 chip and $300 drive, comes to $880. The average is $790. The Xbox 360, meanwhile, comes in at $476 through averaging prices from different analysts. A study from iSuppli puts the figure at $525.

Interesting stuff — the systems are almost exactly the same except for Blu-ray and the Cell processor. Unfortunately, those additions put PS3’s price way up there.

• PlayStation 3 component prices: Why so high? [CNET]

Sorry to be so threatening. Check out the results of an unscientific poll about next-gen gaming while we get sued by Puff Daddy.

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And yes, we know that’s not his name anymore. But that’s beside the point. Check out this recent poll on About.com — it’s a survey that asks which next-gen system you’ll buy. With more than 15,000 ballots cast, PS3 is at 16 percent, lagging way behind the Xbox 360 (41%) and Nintendo Revolution (39%). We’re in trouble!

So hit it up, vote if you so desire, and think about how About.com’s design could be more cluttered or trashy-looking. (We haven’t found a way yet.) See ya at the recount.

• Which Next Gen Console Survey - Nintendo Revolution, PlayStation 3, or Xbox 360? [About.com]

How much will Sony really lose if it launches the PS3 later this year? Some say a lot, but we’re not so sure.

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This week’s Game Over column addresses the recent flurry of news about a PS3 delay — news that Sony, by the way, has categorically denied while failing to produce any tangible evidence to the contrary. The basic reasons behind the delay speculation: the PS3 is very expensive to produce right now, and the specs for the Blu-ray drive haven’t even come in yet.

Chris Morris, the columnist, reminds us of all the pressures on Sony to get the PS3 on the market soon, and discounts a lot of the “chicken little” delay predictions.

Granted, the possibility of a delayed PS3 launch and prohibitively expensive production costs make for some great headlines and message board chatter, but there are a few other realities to consider.

He’s obviously been reading our headlines. Check out the column for his list of reasons why the PS3 can’t afford a delay, and why it won’t matter for Americans anyway. He’s right about one thing: if we get the system before the end of the year, all will be well and good. But he also cites a lot of market pressures that could force Sony to jump the gun. We’ll dissect them here, and explain why they’re not worth the rush.

Market Share: There’s no question that every Xbox 360 sold is a setback for Sony’s market dominance. But you know what’d be worse? Prematurely releasing a system that’s too expensive, in limited supply, and has only a sparse selection of underdeveloped games. That’s our forecast for spring, and we doubt Sony is desperate enough to blow a launch worse than Microsoft did.

What’s more, the lion’s share of the gaming market that PS2 occupies isn’t all about getting there first. It’s about brand recognition and loyalty and PlayStation still beats Xbox on that, hands down. It’s also about lining up the best games (and having the best fan web sites). Microsoft can chip away at Sony, but they’re in no position to take the lead. This time, Sony has the superior technology and the street cred. We’re not the first to suggest that the 360, with its early (and rushed) entry, is more like the Dreamcast than the PS2.

Blu-ray: We’ve talked a lot about how the Blu-ray DVD format, rather than games or consoles, is Sony’s real cash cow this time around. Since the format has to compete with the Toshiba- and Microsoft-backed HD-DVD, it seems like Sony should be desperate to get the PS3 and its Blu-ray drive into homes. But in reality, there’s no reason to rush.

The good news for Sony is that no matter when the PS3 comes out, it’ll immediately be the cheapest high-definition DVD player out there. Standalone Blu-ray players cost more than $1000, and HD-DVD players are still above the PS3’s price point, even if it’s $500. And we doubt the Xbox 360’s HD-DVD add-on will be a huge seller or a major threat. The truth is, Sony’s got the movie studios and computer manufacturers on its side. Blu-ray is in business. We can wait six months to upgrade our movie collections, and nothing is affordable enough to steal Sony’s share of the HD-DVD market in the meantime.

The Insiders: Here’s the bizarre part of it all. After outlining why Sony must launch now, Morris pulls out some off-the-record interviews with industry insiders — and they all say a delay is inevitable. He also seems to think that an American spring launch was never realistic, but Sony has gone to pains over the last 9 months to remind us that they haven’t decided which region would get the PS3 first.

There was a time that speculation of a Blu-ray-driven American launch was floating around, and with Xbox 360’s near-simultaneous worldwide launch, an American springtime launch was never really out of the question. That is, until any spring launch became nearly impossible.

So hey, we wouldn’t mind being proven wrong. We could use some shiny new Japanese games to play in a couple months, but we just don’t think it’s feasible — or reasonable — to rush the PS3 to the market. It’s not under as much market pressure as it seems, and a well-paced fall launch with enough units to keep shortages low would prove, for another generation, that Sony runs this show.

• PlayStation 3 delay? Don’t panic! [CNN/Money]

The DigiTimes in Taiwan quotes Sony’s manufacturers there as saying that Blu-ray problems will delay the PS3 launch until August.

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The DigiTimes has been reporting heavily on its hometown Taipei Game Show, and now they’ve got a scoop from Sony’s Taiwanese contract manufacturers. The site says that these manufacturers have reported that the PS3 will be delayed until August because of problems with the specs and price of the Blu-ray high-definition DVD drive.

The hitch is copy protection — the final standards for the new disc format have yet to be agreed upon. This meshes with what Sony Asia’s managing director said a few days ago, that the company will wait until it’s “completely prepared” to combat piracy before it launches the PS3.

Meanwhile, the new Blu-ray disc drives may be prohibitively expensive for some time — Merrill Lynch cites them at $350 apiece, and puts the PS3’s total manufacturing cost at $800. So even when Blu-ray copy protection is ready to go, a delay might be in order to wait for Blu-ray prices to drop a bit.

So, is this report credible? Though we’ve just started reading the DigiTimes this week, they’ve done a good job reporting from Taipei thus far. And this news seems to match up with everything else we’ve heard, both from a Sony spokeswoman who discussed Blu-ray problems and Sony Asia’s boss on piracy.

As far as the August date, who knows; we’ve heard September this week too. Maybe nobody knows, because the real date hasn’t been decided. But you can bet on one thing: it ain’t lookin’ good for Spring.

• Sources: Sony PlayStation 3 launch delayed until August [DigiTimes]

According to the Japanese press, Sony Asia’s managing director says games could eventually be downloaded from PS3’s online service.

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Apparently Sony’s muzzle doesn’t extend to Tetsuhiko Yasuda, the managing director of Sony Asia. A few days ago he spoke at the Taipei Game Show and made some ominous remarks about waiting until the PS3 was “completely prepared” to combat piracy.

Today he seems to be mouthing off to the Japanese press about the possibilities of PlayStation 3’s recently leaked HUB online service. Our buddies at PS3 Center report that Yasuda says that games may eventually be available for download from HUB, rather than buying hard copies at the store. This meshes with rumors in PSM about an iTunes-like downloading service, among many other PS3 media possibilities.

We don’t speak Japanese, but if any readers out there can hook us up with a more detailed translation of the article, we’ll be forever in your debt. Until then, check out PS3 Center’s story and some other links on the subject below.

• PS3 Titles to be Downloadable? [PS3 Center]
• Original interview from Impress Watch — Google’s translation
• Sony exec kinda sorta confirms Hub service and downloadable PS3 games [Engadget]

A new Sony spokesperson steps up to deny any plans for a PlayStation 3 delay, reaffirming a Spring launch.

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Yesterday, we got the first official admission from Sony that a PS3 delay might be in the cards. Or, at least, we thought so. At that time, a Sony spokeswoman (who wasn’t named in the article, lucky for her) told Reuters that the company is “aiming for Spring,” but that delays on final specs for the Blu-ray drive and some A/V input/output components could push the PS3 back a few months.

Of course, it all depends on whom you ask, even within Sony itself. Today another spokesperson, Kei Sakaguchi in Tokyo, had this to say:

“There is no change in our original plan to release the console in spring 2006,” Sakaguchi told the press in Tokyo, referring to the company’s only stated goal for the launch so far - namely that the console will appear in at least one territory, most likely Japan, this spring.

Upon closer inspection, both statements could be true at the same time. Though the first spokesperson’s tone is pessimistic compared to the second’s, they’re really saying the same thing: We’re aiming for Spring. Our plan for a Spring release has not changed.

So we’ll give Sony that — the plans haven’t changed. But that’s not answering the real question: will they be able to live up to that plan and put the system on the market in the next four months? We’d be amazed if they did. For more, check out this weekend’s feature on the latest PS3 delay news.

• Sony denies PlayStation 3 delay reports [GamesIndustry.biz]

A spokeswoman for the company says they hope to release PS3 in Spring, but waiting for Blu-ray and A/V specs could force a delay.

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For the first time, an official statement from Sony has acknowledged the possibility that the PS3 won’t meet the Spring 2006 launch deadline that the company set last May. They’ve been keeping quiet on the issue, but pretty much everyone who’s paying attention (from PS3week all the way up to Merrill Lynch) has been predicting a delay for months.

The latest news is that Sony’s stock is tumbling after a downgrade from Merrill Lynch, which says the PS3 will cost $800 to manufacture and might not make it to the market this year.

This has finally broken Sony’s silence on the PS3’s development schedule. From Reuters:

“We’re aiming for spring, but we haven’t announced specific regions,” a spokeswoman for Sony Computer Entertainment said, adding that it was waiting for the final specifications on some of the technology it is using in the PS3, such as that related to the Blu-ray drive and to input and output video and sound. …

“We’re waiting for them until the last possible minute, but the launch could be pushed back if they’re not decided soon,” the spokeswoman said. If the PS3 is not ready in time, the company will choose the next best timing for the launch, she said.

Sure… blame it all on Blu-ray! If that’s the real reason that PS3 could be delayed for months, it is certainly a sweet bit of irony that Sony’s biggest cash cow (royalties from Blu-ray discs) is also its biggest obstacle in getting the PS3 out on time.

In fact, the main reason Sony needs to get PS3 on American shelves soon is to enter the high-definition DVD market. PS3 will be the most affordable Blu-ray player, and Sony needs those players in homes as soon as possible to compete with Toshiba’s HD-DVD, which will be out soon (and can be attached to Xbox 360).

So Blu-ray’s the reason Sony needs to rush, and it may also be the main reason they can’t make it on time. Talk about trouble.

• Sony aims for spring launch of PS3 but could delay [Reuters]

EARLIER: The lowdown on Blu-ray and the PS3.

The financial firm expects PS3 to be delayed until fall in Japan, but Sony holds strong to its spring release plans.

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Sony’s stock is down on the Japanese market today, following a report from Merrill Lynch that predicted Sony would be forced to delay the PlayStation 3 until Fall 2006 in Japan and early 2007 in the U.S. The Merrill Lynch report, among other things, cited the manufacturing cost of the PS3 — about $800, according to their calculations — as prohibitively expensive for a spring launch.

Still, Sony holds strong to its spring release deadline. Here’s what a spokesman told Bloomberg news:

“There is no change in our original plan to release the console in spring 2006,” said Kei Sakaguchi, a Sony spokesman in Tokyo.

Can’t get much clearer than that. We’ll just have to see if they come through in the clutch.

• Sony Shares Fall on Report of PlayStation 3 Delay [Bloomberg]

For a system that isn’t even pubicly playable yet, the PS3 has had one hell of a week. We recap it and explain what it all means.

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Seven days ago, no one had so much as touched the thing, and Sony was still pretending it could meet its Spring 2006 launch deadline. Now, with the Taipei Game Show and a few media scoops under our belts, we know a lot more — and expect a little less — from the PlayStation 3.

And in the most recent news, a Merrill Lynch analysis has laid out two new predictions: each PS3 will cost Sony about $800 to manufacture, and that might make it tough to release it in 2006 in the US. (Consoles are always sold at a loss, so it won’t cost you the full $800. But it’ll still be expensive.) The report suggests a Fall 2006 release in Japan and an early 2007 release in the US is the likely result.

So how did we get here? Well, it took a hands-on review of the PS3 thanks to some friendly and anonymous developers, Sony’s first public acknowledgement of a possible delay, and a couple industry-insider scoops. Here’s how it all went down:

Kikizo Plays the PS3

A week ago today, a UK gaming site called Kikizo published its exclusive hands-on look at the PS3. It scored some playing time from three developers, and the overall tone went something like, “this is cool, but there’s a lot of work to be done.” Here’s a snippet of their analysis:

Sony’s showings of PS3 to date have been seriously sexy. But the reality, while still impressive, is nowhere near the leap beyond Xbox 360 Sony wants you to believe, and it seems many projects are still at an early enough stage for things to start getting a little worrying.

Another Game Show No-Show

So now that someone has touched it, played with it, and told us all about it, it’s Sony’s turn. Right? Unfortunately, this week’s Taipei Game Show wasn’t the big event we’ve been waiting for. Despite devoting about one-quarter of its space at the expo to the PS3, Sony still showed nothing but pre-rendered trailers and some (presumably empty) PS3 cases. In one interesting note, the boomerang controller is back, which kind of puts a damper on hopes for a new design.

Then again, we might have a lot of time for controller development while we wait for the console’s release. In Taipei, the managing director of Sony Asia spilled some doubts about the PS3’s Spring release for the first time. He guaranteed the PS3 would launch in 2006, but he added that “we want to be completely prepared” to take on counterfeiters, which he described as Sony’s “No. 1 competition.” Sorry, Microsoft and Toshiba.

Meanwhile, the quarterly corporate report from nVidia, the company that makes the graphics card for PS3, shed a little more light on the PS3’s launch schedule. nVidia says they don’t expect any royalties from Sony before the end of April — that means they don’t think the PS3 will be selling before then. There’s still more than a month of Spring after April, but it sure doesn’t make things look good.

Launch Date Leaks

This makes things look even worse. Citing industry sources, the gaming site Next Generation reports that the PlayStation 3 is scheduled for a September release in the U.S. and Japan. Their sources say they’ve seen a list of software titles dated for the launch, and the site goes on to guess at two dates: Sept. 21 for Japan and Sept. 16 for the States.

The article also reveals a little more about the PlayStation 3’s central network, which will be set up as a direct competitor to Xbox Live. It’ll be called the PlayStation HUB, and mimic most of the features of Live — chat, online play and so on. It’ll also hook up to the PSP, which is always cool.

The Waiting Game

So, every card is on the table except for the ones that matter — Sony’s. We’ll have to wait a while longer for a serious PS3 launch announcement, most likely at this year’s E3 in May. Merrill Lynch is even doubtful about this, but we hope Sony picks up the pace to have something concrete for the expo, where it announced the PS3 in 2005.

For now, they’ve been frustratingly silent on pretty much every aspect of PS3 development. That means one of two things: most likely, they’re not ready and they don’t want to make any more promises they can’t keep. Or, if we’re lucky, they’re bluffing and the PS3 will launch sooner and cheaper than expected. We’re not exactly banking on option two.

We like to leave the wild, shot-in-the-dark predictions to the analysts, but by now we’ve got enough information to make at least an educated guess. The games Kikizo has played still need a lot of dev time. Nothing new about the system has been revealed this year, despite chances in Taipei and Las Vegas at the Consumer Electronics Show. Sony still seems to claim the PS3 will be released in the Spring, but Sony Asia’s managing director wouldn’t go so far as to repeat it. And somewhere, someone in the industry has seen a launch schedule marked September.

So expect the PS3 in the fall, and expect it to be the most expensive console you’ve ever bought. You’ll see a decent array of launch titles, mostly comparable to Xbox 360 games, but definitely nothing that’s going to display the system’s “true power.” Those come along several years down the road.

It would surprise us if Sony released the system in the U.S. before Japan. Some have suggested that releasing it in the States first would help build the crucial base of Blu-ray players, which is going to make Sony far more cash than games ever will.

But PS3 will still be marketed as a gaming machine, and gaming machines hit Japan first as a matter of principle. Or, if you want to completely alienate the Japanese market, you can take lessons from Microsoft.

So hey, cuddle up with your PS2 for a couple more months, and relax until Sony gets its act together with a legitimate announcement. Until then, we’ll keep you updated on whatever leaks to the outside world. After that, we’ll see ya on HUB.

More scoops for Next Gen — they reveal some insider info about PS3’s competitor to Xbox Live.

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We’ve heard a bit about the online service that Sony is planning for the PlayStation 3, particularly that it will be a “full-on assault” against Xbox Live. Now we’ve got some new info, including the tentative name for the service: PlayStation HUB.

As suggested by the name, which is in all caps either because it’s an acronym or just to be cool, the HUB will be a central online service comparable to that of Xbox Live, including “chat, downloadable demos, independent games and online play.”

It will also handle PSP online play, and will be a subscription service. Sounds good to us — we’ll keep you informed when official confirmation is made.

• Exclusive: PS3 HUB; September Launch [NextGen]