Sony losing over US$ 300 on each 20GB PS3

The manufacturing cost of the 20GB PlayStation 3 is US $805.85 (EUR 629.8), over US $300 more than the retail price, according to research by electronics specialist iSuppli

The price is an estimate based on the console's component parts, and does not include the cost of controllers, cables and packaging.

The research reveals that Sony is taking a USD $306.85 (EUR 239.8) loss for its 20GB model, and a US $241.35 (EUR 188.6) for the high-end 60GB model, which retail at US$ 499 and US$ 599 in the US, respectively.

"The size of Sony's loss per unit is remarkable, even for the videogame console business," said iSuppli.

Although iSuppli reveals shock at the loss, it is also impressed with the level of design and engineering that has gone into the console, currently launching across North America.

"To give an example of how cutting edge the design is, in the entire history of the iSuppli Analysis team, we have seen only three semiconductors with 1200 or more pins. The PlayStation 3 has three such semiconductors all by itself," said Andrew Rassweiler, senior analyst for iSuppli.

He continued: "There is nothing cheap about the PlayStation 3 design. This is not an adapted PC design. Even beyond the major chips in the PlayStation 3, the other components seem to also be expensive and somewhat exotic."

Last year, iSuppli measured Microsoft's costs for the Xbox 360 hardware at US$ 127 (EUR 99.2) above the retail price.