PS3 build costs reduced

According to market research company iSuppli Sony has managed to cut the cost of the PlayStation 3 components by 35 percent over the last year.

The company says that the cost of PS3 parts now adds up to $448.73 compared to $690.23 for the first generation PS3 hardware in mid-2007.

The cost reduction is mainly down to a shift in Cell CPU manufacturing shifting from a 90-nanometre process to 65nm. This reduces power consumption and allows Sony to put a cheaper PSU in the console. Other savings come from an integration of various console functions into single chips. Such hardware revisions are common during the lifetime of a console.

Each console still makes a loss for Sony but iSuppli believes that Sony could break even during 2009 with further hardware revisions.

Selling consoles at a loss is nothing new, it just relies on selling enough games for the format to shift into profit.

Source: Gamepro