It will not cost $500 at launch thats rediculous
Sony owns more then double the marketshare of MS, and pumps out more then 3x\'s as many games.
The fact is because of Sony\'s dominant marketshare they can afford to take a bigger loss on the hardware. They\'ll make it up in the usual ways liscensing, games, periphials and downloadable content.
Sony might take a larger loss, but there larger profit margins will easily make it up. Sony can also bank on their machine being the most powerful, so add that to the already dominant palystation name and Sony is really in a winwin situation and has no reason to try and squeeze more money out of early PS3 adopters IMO.