The XBox 360 is a much, much better system already than the XBox ever was in terms of game library. Gears of War, 99 Nights, Quake 4, Enchanted Arms, Phantasy Star Online, Dead Rising and with games like Halo 3 and Lost Planet on the horizon for 2007, Sony faces a much tougher challenge. If Microsoft has already hit 10,000,000 units sold and is still climbing, as I suspect they are, it's probably only a matter of time before Square-Enix gets antsy and starts to think about Final Fantasy 13 and other games appearing on the XBox 360 and Wii.
Squeenix will never jump. But you may have a point. However its not like the PS3 is bereft of good looking releases either: Lair, Heavenly Blade, Motorstorm, and F1 Championship hit in March alone.
It really wouldn't suprise me if the DVI was HDCP enabled - in fact the content providers will probably insist.
Wouldn't surprise me either - but what did surprise me is that it doesn't. No HDCP on Apple TV whatsoever. Interesting, no?
Makes you wonder if HDCP isn't kind of stillborn, with the X360 not supporting it, Sony demurring on it, and Apple now not even including it on their HDMI port...
The fact that Apple is the #1 'DRM purveyor' is just a function of the fact that they are the #1 music download service. DRM was a condition absolutely insisted upon by the big record labels. You can argue as to whether or not DRM would have any kind of foothold as it does today were it not for iTMS, and its a valid argument. In the end, this too shall pass; you can't change physics and the old model must pass away eventually. (Kicking and screaming, as it turns out.)
This thread has been one of the funniest things I've ever seen. All the PS3 fanboys are bashing Carmack for his comments about Cell, despite the fact that it's quite clear none of them program at all, let alone program on asymmetric CPUs.
I went to the thread - its not nearly as bad as you make it out to be, there's actually some reasonable people on there.
Example: "Why shouldn't devs bash hardware if they don't like developing for it? He's pointing out exactly the thing that many other people pointed out; Cell has a lot of theoretical power, but it requires a lot more developer time and effort to get it."
Or this: "... it's more like a brilliant programmer with a long track record of effective optimization on a wide variety of targets observing that multi-core architectures are a lot harder to develop for than single-core (he mentioned that, too), and that asymmetric designs are even harder."
Anwyays, this is really nothing new, he didn't like the PS2 either - just not a fan of Sony's approach. He's famously picky about his dev tools, not that there's anything wrong with that (NeXTstep, heh).
I burn with jealous rage when I see the Xbox360 GH bundle. It was the last thing my PS2 could be proud of (so to speak), but the original guitar pales in comparison to the new white flying-V style one. Plus it apparently has an optional port for a distortion pedal.
Well, near as I can tell, it's OS X. Specifically, its a Finder-less Darwin, with Core Animation, sans all the optional install stuff like Apache and anything else it wouldn't need. But it does multitask, it is running a reskinned Safari, real widgets and the rest. Which makes sense, really.
We're talking about marketplace successes. I see two here, the media and the games, right? Now, first assertation was that failure of the media part of blu-ray would consitute a huge loss for Sony and I agree there. But would it be a failure of the format, well, not really. Games are a bigger industry than movies or music - perhaps not combined but music is a nonstarter. But it would only be for one platform, the PS3. If that platform is a success anything like the PS2 then the investment in blu-ray from Sony's POV is at least paid for. For Disney and other media companies it would be total failure. In this way, blu-ray could be a failure in the marketplace for movies but still work out (for Sony) if the PS3 itself is successful. That's my position. We could argue about that one for awhile but without knowing exactly what has been spent and what deals are in place its all hand-waving anyways.
About the UMD:
They wanted UMD to be a standard media format.
You know I'm not really so sure they did, despite the stupid name. It seems more like a convenient side-effect of developing the PSP. They never pushed it like MiniDisc, there were no UMD writers or media. And Sony always releases those things traditionally. I think it more likely they made a design decision to use small minidisc-like media for a bunch of internal political and manufacturing reasons. The PSP can deal with downloaded games just fine and they push that, so its obviously not a huge deal.
Yep, and the success of CD occured only when there was no competition, which makes it a rather poor example to analogize to current events.
Ok, fair enough.
The members of the consortium who are only media providers have no vested interest in BluRay as such, for them it's about business arrangements which were they to fall through has no dramatic impact on them.
Are you sure about that? I'm asking as I actually have no idea what investment is required to be in 'the consortium'.
Is Sony interested in BluRay being just YAGF? Does Disney care about YAGF?
I would say yes to both, obviously more Sony. Disney cares like they care about whatever is prevalent.
If at the end of the day the only thing you can do with BluRay is play PS3 games, then yes, it failed.
Totally disagree. They have several other ways of leveraging this tech, its not solely for movie distribution.
Bear with me a sec and I will explain my reasoning.
When you examine both the technical specifications for HD-DVD and Blu-Ray, as well as the software/codecs they both use, you realize that they are very close. In fact the only discernible difference is that the BDs have a higher density. Both use MPEG-4 containers for video streams, both use a variation of H.264 encoding. Either disc can use either codec, H.264 or MS's VC-1. These two codecs themselves are 95% similar; the only difference being that VC-1 is a little friendlier in terms of playback processing required, and H.264 leans towards quality at the cost of needing higher processing to decode. And the discs themselves are two substrates, 120mm each. Other than the precise optical pickup method they are twins.
The upshot of this is that it is actually very easy to produce media content for either disc. The conversion is trivial.
When presented with two disc formats that are basically the same in every way other than the fact that one holds a lot more, what do you think the drift will be?
Putting all of that aside, Sony also needs a standardized optical HD format for all their other pro video (and audio) gear. DigiBeta doesn't exactly cut it anymore. So there are strategic reasons for offering this. At the end of the day they are a hardware company more than anything else. Schizophrenic hardware company, but nonetheless...
There is a massive investment in the equipment and facilities necessary to make tube TVs and they will continue to milk it until there is no profit left to be made. Given how much cheaper the bargain electronics-brand tube televisions are than the major name brands, I think there is quite a lot of leeway left there.
Again, i find myself agreeing with your basic principle - I think we just differ on the speed of the change. I am in a big metro area, perhaps I am biased. Anyways.
That's a pretty delusional list of "successes". UMD is as much a "standard" as GBA carts?
Not sure how I can make this clearer: yes. What else can you use a GBA cart for? nothing, games. UMD? Now, nothing, just games. Its a wash. Except the UMDs are much cheaper to make.
You can claim the CD as a success, though I attribute most of that to Phillips, but most importantly there was no competing standard for digital music.
Attribute what you like; we were discussing Sony's successes and failures at marketplace standards.
Ooh, media giant Sun! But you know there's a difference between supporting a format and being the driving force behind it.
Ok, bad example. (You skipped Disney, conveniently.) Go wiki the Blu Ray consortium, you'll get a better list.
If Sony dropped out of Blu-Ray, it would die instantly.
No, it would become yet another game format - this was covered above. Seriously, what are you not getting about that? What could you use those black reverse-spinning PS1 discs for? Did anyone care? No.
If Sony doesn't stop preventing dual-format players from being made in their desperate desire to "win" and crush their enemy, then I predict you'll be able to chalk up BluRay -- and HD-DVD as well -- amongst the list of failures.
Sony is simply acting as the point man in this little fight, but I assure you they are hardly alone.
Why's that? Because an upsampled DVD looks pretty damned good.
That's not why. Look, I tend to agree with you. Most people don't complain about their TV picture. But you are making a completely value judgement. Some other nerds, the AV hardcore types, LOVE this stuff. Look at the stereos. And they push they market. I saw a 32" 720p flatscreen LCD on sale yesterday for $700 Canadian. Its coming. And it doesn't even need 'average folks' to push it - these sets will soon be the only thing in stores. Try to buy a black and white TV lately? Anyways, thanks for the reply.
More importantly, the PS3 could even win, and blu-ray could still lose. Since when has Sony ever been able to push a format?
Yes, when have they done that? You must be thinking of all those standards they were a part of that flopped, like 3.5" floppy disks and compact discs.
Or perhaps you mean minidisc? Not very popular here, but they were definitely around, and in the UK quite pervasive for awhile. They did "win" vs a little thing called DAT, if you recall.
MemorySticks? All over the place. Particularly in high end cameras and phones.
Oh yes, speaking of high-end. Betacam SP for broadcast, maybe? DigiBeta? All total failures, right?
UMDs flopped for movies, but it doesn't matter, that was just a bonus anyways. Its the PSP game format, now just as proprietary as any Gameboy/DS cart.
As for Blu-Ray, well, in this case we aren't even talking about Sony. There's a few other companies on the Blu-Ray board that have a vested interest in it succeeding - but they are pipsqueaks like Disney, Apple and Sun.
Very clever PR. I'd take these results with a Great Salt Lake sized grain of salt. Don't let these sleazy PR hacks brainwash you into doing their work for them.
Oh, it is to laugh.
If I take the research - sorry, "PR firm" with a such a large grain of salt, what do I take your opinion with, Random Slashdot Guy?
I'm glad you are so convinced. Myself, anecdotally, this report jibes with what most people think about Sony. They don't know about batteries and rootkits and so forth; they know the Bravia commercial with the superballs flying down the street.
PS3 didn't raise the bar in any way with those features, since the Wii has proven that those features are not necessary in any way for a given console to succeed.
The PS3 certainly raises the technical bar. And its far, far too early to decide how all these new consoles will pan out, sales-wise. Wii is a superstar right now for sure, but Xbox360 is doing great also, and the PS3 is not even on sale in the UK yet.
(Such as myself, I have yet to buy a console that cost more than $150 for the system, and yes, that means I'm usually playing the previous generation but I have no problem with that. Used games are cheap, and I have better things to spend my money on.)
Man, I envy you. I really do. You spend a lot less than I do to be happy with your games. But obviously you are not the target market of the Xbox or PS teams. You are part of an emerging market that Nintendo has uncovered, the Casual Gamer. I think its great that they have cracked this group - and it bodes well for the overall market expansion of video games in general. But understand that Nintendo will have a completely different dynamic to work with as well - by your own admission you (and casual gamers like yourself) spend very little money on gaming. That might be a challenge for them down the line, time will tell.
Seriously: They should sell adult games the same way they sell adult magazines -- clearly labelled and with a wrapper around them, unless they're in an adults only area. I have no problem saying that GTA 3 was completely inappropriate for 7 year olds.
If the game is porn, sure. If its just 'rated M' (i.e. rated 'R' equivalent) then they should sell it like they sell movies - next to everything else. The 'AO' titles can go in the special room.
Anyone ever seen an AO video game, btw? (outside Japan?)
When I here about how long Final Fantasy 12 is or Zelda Twilight Princess, I involuntarily cringe. It's not that I don't think it would be fun, it's just that I don't have time for that much fun in my life.
Cringe? Really?
No one is forcing you... and besides, you are thinking of this in a limited scope. Episodic content can be as simple as more songs for Guitar Hero.
The problem there is that Sony would then be abandoning the market they've already created. While that market isn't matching up to the DS, it's still a significant population, and a population that has been "loyal" to Sony in buying their handheld. Considering that at least part of the magic of the DS is the ability to play the back-catalog of GBA titles, it seems like people would consider it another strike against Sony if they released a new handheld that wasn't backward compatible with the first PSP's games.
Yeah - I thought that too. But if you do the math on the actual size of these games, it really doesn't look so bad if they went all-download. A UMD, if I recall, is 1.8 GB. Most PSP games don't max that out, some are significantly smaller. With 4GB memorysticks from Sandisk going for around $100 (CDN), it becomes a viable option. They'd have to pack-in at least a 1GB stick with the 'new' PSP though. And if I am being totally realistic, they'll probably hang onto UMD through sheer inertia as you said and then its just Yet Another Game Format. I'm hoping Sony looks at the phenomenal success of the DS and releases this lite PSP with maybe a camera built-in. And a pony of course.
So what I'm prevented from doing is connecting the PS3, via DVI, to ANY device that isn't HDCP, including my console switch, so I can't put the PS3 on the beautiful 24" HDCP-capable monitor I use for everything else. Since I am not about to buy another monitor just for the PS3, or spend extra money to replace a perfectly functional DVI switch with a DVI switch that also does HDCP, just for one stupid games machine, it means the PS3 gets dumped on a lower res display.
Ah, ok - thank you. I didn't quite get that you had actually run out of HDMI inputs, you must have a lot of very new AV gear. I was also not aware that HDCP somehow 'carries' over a DVI converter - I will have to research this more.
HDCP is, in fact, an issue. See, there's a common claim that HDCP applies only to blu-ray movies. NOT SO! If I connect my PS3 directly to an HDCP monitor (using HDMI->DVI), I get playback in everything -- XMB, games, Linux. If I connect it through a console switch, I get static. If I connect it to a non-HDCP monitor, I get a blank screen.
I don't quite understand what you mean. I've played back 1080p files through both HDMI and Component. Now, my TV doesn't go to 1080p, only 1080i. But what is the limitation? What were you prevented from doing, other than using your switcher? If you used an HDMI-DVI converter, then I would have to guess the issue is not HDCP but something else? (as you've now converted the signal successfully?) I apologize if I missed something.
By the way I disagree with your comment about component vs HDMI - to my eyes they are awfully close, so close only an expert could tell. I am an expert as it happens, but the difference is so slight as to be practically indistinguishable. Again this is abviously all for 1080i - 1080p is impossible over component. (I'm not quite sure how the Xbox360 claims this actually - it was supposed to get a 1080p 'update' but it only has component video out.)
I thought the X-Box was sold at a loss on the hardware itself (and a significant loss at that), and they make their money from sales of licensed games for it. Isn't that how the major consoles work?
That's part of the story. It really depends on which console you talk about. The Xbox plan has always been similar to the Playstation one, which is to make money of game licenses as you said. However the mass production of these machines is aimed partly at driving down the cost of the components as demand ramps up, so the original xbox (console, not division) probably made a profit sometime within the first year as those components came down.
The Wii probably makes a profit now - hard not to, on 88 megs of RAM and a 700Mhz proc.
The PS3 certainly costs Sony money now, but they have taken a bigger gamble than MS, assuming they can bring Blu-ray and the Cell chip down from their current high cost by riding on their brand's success. It actually doesn't bode well for a price-drop on PS3 hardware anytime soon, as Sony will want to recoup as much as they can once they begin to break even on that hardware. But look at what they did with the PS2 Emotion Engine; it shrank to a single chip (from 3) a long time ago and basically provided the design for the PSP. Its quite complicated when you try to work out all the angles Sony is looking at.
I expect that soon enough we'll see a Sony store on the cross bar selling downloadable games, movies and music for the PSP. It wouldn't even surprise me if / when a PSP Mk2 appears that the UMD drive is an optional external add-on and that games can be played from a large chunk of internal memory and managed via firmware, PC / PS3 or downloaded directly from the store to be played.
Well, we already can see a rudimentary store for this in the PS3 'Playstation Store'.
But I think you are absolutely right. Memory card prices are falling like crazy - it makes sense to drop the UMD and release a PSP 'lite' that is thinner/smaller overall.
Slashdot Mirror
We are 9 weeks from the launch. Some perspective is needed.
Ok tell you what, let's meet back here in a year and we'll see who's right, you or THE PLANET.
I mean, seriously.
Squeenix will never jump. But you may have a point. However its not like the PS3 is bereft of good looking releases either: Lair, Heavenly Blade, Motorstorm, and F1 Championship hit in March alone.
Wouldn't surprise me either - but what did surprise me is that it doesn't. No HDCP on Apple TV whatsoever. Interesting, no?
Makes you wonder if HDCP isn't kind of stillborn, with the X360 not supporting it, Sony demurring on it, and Apple now not even including it on their HDMI port...
The fact that Apple is the #1 'DRM purveyor' is just a function of the fact that they are the #1 music download service. DRM was a condition absolutely insisted upon by the big record labels. You can argue as to whether or not DRM would have any kind of foothold as it does today were it not for iTMS, and its a valid argument. In the end, this too shall pass; you can't change physics and the old model must pass away eventually. (Kicking and screaming, as it turns out.)
I went to the thread - its not nearly as bad as you make it out to be, there's actually some reasonable people on there.
Example: "Why shouldn't devs bash hardware if they don't like developing for it? He's pointing out exactly the thing that many other people pointed out; Cell has a lot of theoretical power, but it requires a lot more developer time and effort to get it."
Or this: "... it's more like a brilliant programmer with a long track record of effective optimization on a wide variety of targets observing that multi-core architectures are a lot harder to develop for than single-core (he mentioned that, too), and that asymmetric designs are even harder."
Anwyays, this is really nothing new, he didn't like the PS2 either - just not a fan of Sony's approach. He's famously picky about his dev tools, not that there's anything wrong with that (NeXTstep, heh).
Trogdor!!!!
Steve was heard to say afterwards, "It was pants-shittingly good."
Well, near as I can tell, it's OS X. Specifically, its a Finder-less Darwin, with Core Animation, sans all the optional install stuff like Apache and anything else it wouldn't need. But it does multitask, it is running a reskinned Safari, real widgets and the rest. Which makes sense, really.
We're talking about marketplace successes. I see two here, the media and the games, right? Now, first assertation was that failure of the media part of blu-ray would consitute a huge loss for Sony and I agree there. But would it be a failure of the format, well, not really. Games are a bigger industry than movies or music - perhaps not combined but music is a nonstarter. But it would only be for one platform, the PS3. If that platform is a success anything like the PS2 then the investment in blu-ray from Sony's POV is at least paid for. For Disney and other media companies it would be total failure. In this way, blu-ray could be a failure in the marketplace for movies but still work out (for Sony) if the PS3 itself is successful. That's my position. We could argue about that one for awhile but without knowing exactly what has been spent and what deals are in place its all hand-waving anyways.
About the UMD:
You know I'm not really so sure they did, despite the stupid name. It seems more like a convenient side-effect of developing the PSP. They never pushed it like MiniDisc, there were no UMD writers or media. And Sony always releases those things traditionally. I think it more likely they made a design decision to use small minidisc-like media for a bunch of internal political and manufacturing reasons. The PSP can deal with downloaded games just fine and they push that, so its obviously not a huge deal.
Ok, fair enough.
Are you sure about that? I'm asking as I actually have no idea what investment is required to be in 'the consortium'.
I would say yes to both, obviously more Sony. Disney cares like they care about whatever is prevalent.
Totally disagree. They have several other ways of leveraging this tech, its not solely for movie distribution.
Bear with me a sec and I will explain my reasoning.
When you examine both the technical specifications for HD-DVD and Blu-Ray, as well as the software/codecs they both use, you realize that they are very close. In fact the only discernible difference is that the BDs have a higher density. Both use MPEG-4 containers for video streams, both use a variation of H.264 encoding. Either disc can use either codec, H.264 or MS's VC-1. These two codecs themselves are 95% similar; the only difference being that VC-1 is a little friendlier in terms of playback processing required, and H.264 leans towards quality at the cost of needing higher processing to decode. And the discs themselves are two substrates, 120mm each. Other than the precise optical pickup method they are twins.
The upshot of this is that it is actually very easy to produce media content for either disc. The conversion is trivial.
When presented with two disc formats that are basically the same in every way other than the fact that one holds a lot more, what do you think the drift will be?
Putting all of that aside, Sony also needs a standardized optical HD format for all their other pro video (and audio) gear. DigiBeta doesn't exactly cut it anymore. So there are strategic reasons for offering this. At the end of the day they are a hardware company more than anything else. Schizophrenic hardware company, but nonetheless...
Again, i find myself agreeing with your basic principle - I think we just differ on the speed of the change. I am in a big metro area, perhaps I am biased. Anyways.
Not sure how I can make this clearer: yes. What else can you use a GBA cart for? nothing, games. UMD? Now, nothing, just games. Its a wash. Except the UMDs are much cheaper to make.
Attribute what you like; we were discussing Sony's successes and failures at marketplace standards.
Ok, bad example. (You skipped Disney, conveniently.) Go wiki the Blu Ray consortium, you'll get a better list.
No, it would become yet another game format - this was covered above. Seriously, what are you not getting about that? What could you use those black reverse-spinning PS1 discs for? Did anyone care? No.
Sony is simply acting as the point man in this little fight, but I assure you they are hardly alone.
That's not why. Look, I tend to agree with you. Most people don't complain about their TV picture. But you are making a completely value judgement. Some other nerds, the AV hardcore types, LOVE this stuff. Look at the stereos. And they push they market. I saw a 32" 720p flatscreen LCD on sale yesterday for $700 Canadian. Its coming. And it doesn't even need 'average folks' to push it - these sets will soon be the only thing in stores. Try to buy a black and white TV lately? Anyways, thanks for the reply.
Yes, when have they done that? You must be thinking of all those standards they were a part of that flopped, like 3.5" floppy disks and compact discs.
Or perhaps you mean minidisc? Not very popular here, but they were definitely around, and in the UK quite pervasive for awhile. They did "win" vs a little thing called DAT, if you recall.
MemorySticks? All over the place. Particularly in high end cameras and phones.
Oh yes, speaking of high-end. Betacam SP for broadcast, maybe? DigiBeta? All total failures, right?
UMDs flopped for movies, but it doesn't matter, that was just a bonus anyways. Its the PSP game format, now just as proprietary as any Gameboy/DS cart.
As for Blu-Ray, well, in this case we aren't even talking about Sony. There's a few other companies on the Blu-Ray board that have a vested interest in it succeeding - but they are pipsqueaks like Disney, Apple and Sun.
Oh, it is to laugh.
If I take the research - sorry, "PR firm" with a such a large grain of salt, what do I take your opinion with, Random Slashdot Guy?
I'm glad you are so convinced. Myself, anecdotally, this report jibes with what most people think about Sony. They don't know about batteries and rootkits and so forth; they know the Bravia commercial with the superballs flying down the street.
The PS3 certainly raises the technical bar. And its far, far too early to decide how all these new consoles will pan out, sales-wise. Wii is a superstar right now for sure, but Xbox360 is doing great also, and the PS3 is not even on sale in the UK yet.
Man, I envy you. I really do. You spend a lot less than I do to be happy with your games. But obviously you are not the target market of the Xbox or PS teams. You are part of an emerging market that Nintendo has uncovered, the Casual Gamer. I think its great that they have cracked this group - and it bodes well for the overall market expansion of video games in general. But understand that Nintendo will have a completely different dynamic to work with as well - by your own admission you (and casual gamers like yourself) spend very little money on gaming. That might be a challenge for them down the line, time will tell.
If the game is porn, sure. If its just 'rated M' (i.e. rated 'R' equivalent) then they should sell it like they sell movies - next to everything else. The 'AO' titles can go in the special room.
Anyone ever seen an AO video game, btw? (outside Japan?)
No kidding. Exactly my thoughts. "Further towards the kill zone please, Mr. Thompson."
Cringe? Really?
No one is forcing you... and besides, you are thinking of this in a limited scope. Episodic content can be as simple as more songs for Guitar Hero.
You couldn't think of a shorter way of telling us that you don't want to buy a PS3?
Yeah - I thought that too. But if you do the math on the actual size of these games, it really doesn't look so bad if they went all-download. A UMD, if I recall, is 1.8 GB. Most PSP games don't max that out, some are significantly smaller. With 4GB memorysticks from Sandisk going for around $100 (CDN), it becomes a viable option. They'd have to pack-in at least a 1GB stick with the 'new' PSP though. And if I am being totally realistic, they'll probably hang onto UMD through sheer inertia as you said and then its just Yet Another Game Format. I'm hoping Sony looks at the phenomenal success of the DS and releases this lite PSP with maybe a camera built-in. And a pony of course.
Ah, ok - thank you. I didn't quite get that you had actually run out of HDMI inputs, you must have a lot of very new AV gear. I was also not aware that HDCP somehow 'carries' over a DVI converter - I will have to research this more.
I don't quite understand what you mean. I've played back 1080p files through both HDMI and Component. Now, my TV doesn't go to 1080p, only 1080i. But what is the limitation? What were you prevented from doing, other than using your switcher? If you used an HDMI-DVI converter, then I would have to guess the issue is not HDCP but something else? (as you've now converted the signal successfully?) I apologize if I missed something.
By the way I disagree with your comment about component vs HDMI - to my eyes they are awfully close, so close only an expert could tell. I am an expert as it happens, but the difference is so slight as to be practically indistinguishable. Again this is abviously all for 1080i - 1080p is impossible over component. (I'm not quite sure how the Xbox360 claims this actually - it was supposed to get a 1080p 'update' but it only has component video out.)
That's part of the story. It really depends on which console you talk about. The Xbox plan has always been similar to the Playstation one, which is to make money of game licenses as you said. However the mass production of these machines is aimed partly at driving down the cost of the components as demand ramps up, so the original xbox (console, not division) probably made a profit sometime within the first year as those components came down.
The Wii probably makes a profit now - hard not to, on 88 megs of RAM and a 700Mhz proc.
The PS3 certainly costs Sony money now, but they have taken a bigger gamble than MS, assuming they can bring Blu-ray and the Cell chip down from their current high cost by riding on their brand's success. It actually doesn't bode well for a price-drop on PS3 hardware anytime soon, as Sony will want to recoup as much as they can once they begin to break even on that hardware. But look at what they did with the PS2 Emotion Engine; it shrank to a single chip (from 3) a long time ago and basically provided the design for the PSP. Its quite complicated when you try to work out all the angles Sony is looking at.
Well, we already can see a rudimentary store for this in the PS3 'Playstation Store'.
But I think you are absolutely right. Memory card prices are falling like crazy - it makes sense to drop the UMD and release a PSP 'lite' that is thinner/smaller overall.