Sony announced its quarterly results earlier today, showing improved PlayStation hardware sales, but ultimately posting a hefty loss.

We're unsure if Meloni was drinking the corporate Kool-Aid, factoring in the 10-year lifecycle Sony has planned for the hardware. Meloni also believes that Sony's slice of the console market share, at 67% during the PlayStation 2 era, will shrink to 50% or below.

GOF 2008: DFC Claims PS3 Unlikely to Break Even, PC Not Dying [Gamasutra]

The market research and analysis firm was concerned about the Wii's fad chance way back in 2006, warning of a risk "that consumers have fun with the Wii controller for a few months, but the fad passes and they move back to their tried-and-true game play methods on a competing system." In DFC's defense, it stressed that this was cause for concern if the console was "defined mainly by its controller", which it isn't. There's also Wii Fit.

DFC Intelligence Forecasts Video Game Market to Reach $57 Billion in 2009 [DFC Intelligence]

The analyzing wizards at DFC see an Xbox future filled with doom and gloom, with the 360 "continuing to struggle" in Europe, despite UK acceptance. They have better news for the Euro industry as a whole, with 2008 expected "to break all kinds of sales records." And they all lived happily ever after. The end.

DFC: 360 Likely "Biggest Loser" in Europe [Next-Gen]

Yup, it's a lot of money... but perspective can also be gained by comparing it to the average income of a Spanish family, where a PS3 is likely to cost up to 35% of the monthly household income.

That's just one of the facts cited in DFC Intelligence's latest 600 page report of the interactive entertainment industry. Overall, they see the PS3 as coming in last in installed base in the next-gen console wars unless Sony changes their strategy. Gamasutra slogged through the whole thing so you don't have to, so jump to the link below to have a look at the pertinent highlights. Florian Eckhardt

PS3 to Slow Industry Growth [Gamasutra]

It's a slow Monday, so what the heck, let's get some more PS3 doom mongering going on.

Over at Next Generation, DFC Intelligence' s David Cole is wondering the fate of the PS3 in relation to its many much publicized launch blunders. The short of it?

While it has always been clear that Sony's dominant market share was destined to decline, there now appears to be the distinct possibility the PlayStation 3 could end up third in market share behind both the Xbox 360 and Nintendo Wii.

Why?

Sony has done very little to justify why the system is worth a premium price for consumers that don't care about raw hardware performance and are not hard-core audio/visual consumers. Unfortunately we believe that represents over 90% of the consumers in the marketplace.

I'd personally argue that the PS3 has done very little to justify the premium price even to customers who are hard-core audio/visual consumers. Atfer all, nothing we've seen so far looks noticably that much better than the 360. Florian Eckhardt

PS3 'Could Come Third' in Console Battle [Next Generation]

I agree with you, DFC Intelligence, that "Sony has done very little to justify why the system is worth a premium price for consumers that don't care about raw hardware performance and are not hard-core audio/visual consumers" but nobody wants to hear you spew such heavy handed market research vitriol.

Plus, it has always been my contention that the $600 price point just doesn't matter—for the first six months. After that, when launch hype has worn off, and the next price drop doesn't have as much impact with what Microsoft can counter, is when the real Sony marketshare blood bath is going to go down. So, we are on the same page when you say "If Sony wants to drive unit volume 2007 needs to be not only the year of price cuts, but the year of drastic price cuts."

However, the following stab at Sony's overly complicated, value unjustified Kutaragi wet-dream is just plain mean!

With the PlayStation 3 the company is going after the high-end power user. It is almost as if Coca-Cola not only decided to go with a new formula, but also decided to exit the low-brow soft-drink business to go into high-end wines.

Daaaayyaaammnnn!! Low brow? You cats are ice cold. Check out further nastiness at the full article. Michael McWhertor

Could Sony Go From First to Worst?

Cole predicts that Sony will not even try to compete with Live. Although the GDC06 keynote by Phil Harrison stressed that Sony was embracing online content, Cole points out that we heard the exact same thing at GDC2000 about the Playstation 2. While the Playstation 3 will be online ready, Cole argues that Sony already has enough headaches trying to produce the system itself without trying to tackle a robust online service on top of that. Instead, they are going to go with a laissez faire online strategy which encourages other parties to build their own services for use in the Playstation 3.

There's a lot more to digest in the article, including Live, Nintendo, Gametap and MMORPGs across all the next-gen consoles. Cole's feature is sure to generate a lot of debate and there's a lot of soothsaying here to digest. A great read.

How Online Services Will Shape the Console War [Next Generation]