PS3 pricing putting Sony's console lead at risk?

According to an ABI Research study, Sony's console pricing strategy for the PS3 is extremely risky, and may ultimately jeopardize the company's market leadership position. The report goes on to highlight the threats to Sony's dominance, namely the appeal of Nintendo's Wii console to casual and new gamers, and Microsoft's Live Anywhere strategy which will allow users to have one gamertag and account to use cross-platform from the Xbox 360, to mobile phones, to their PCs.

"Asking consumers to pay $500 to $600 for a game console, when most have yet to purchase an HDTV, will give many current PlayStation 2 owners reason to consider the competition," said Michael Wolf, principal analyst with ABI Research's broadband and multimedia research practice. "Sony has clearly hamstrung itself with a box that is expensive to manufacture, and these costs are driving a retail pricing strategy that places a high financial burden on the consumer."