Research firm iSuppli suggests the Sony is closing the gap between the cost of making a PlayStation 3 versus the retail price, reporting that the loss on each system sold has dipped below $50.

iSuppli indicates that each $399 system is now costing the company $448.73, which makes the loss on each system just a hair under $50. This of course is a huge improvement over the launch figures, which had the $599 model costing Sony upwards of $840 to manufacture. iSuppli cites a decrease in parts from 4.048 to 2,820, the lowered price of core components like the Cell processoe and the Nvidia Reality Synthesizer, and the removal of the Emotion Engine as key factors in the console's reduced cost.

Great news, but with analysts and consumers alike calling for a lowered price tag, I wouldn't expect the PS3 is going to break even any time soon.

iSuppli: Sony Still Losing $50 With Each PS3 Sold [Gamasutra]