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IMPORTANT: I have nothing against the Playstation 3 or Blu-ray. Never having played the PS3 or watched a movie on Blu-ray, I really COULDN'T have anything against them. My statements about the PS3's current sales are based on the numbers as I know them, not my opinions or any data that I can directly and personally confirm. This is purely objective, from an economic standpoint, not from a gaming standpoint.
It certainly looks like Blu-ray is winning the format wars, which is exactly what Sony's Playstation division wanted. Sony has been reasoning all along that the success of Blu-ray would help the PS3, and their reasoning was relatively sound. However, now that both have been around for a while, we see Blu-ray with strong success and the PS3 trailing its competitors. Why?
I believe Sony was hoping Blu-ray and the PS3 would help each other, but it only ended up working one way: the PS3 helped Blu-ray, but Blu-ray didn't help the PS3. I believe Sony's mistake rests in the branding: rather than calling this device the Playstation 3, they should have given it a new name to separate it from its video game-focused predecessors. Why? Well, the only way someone can know that the PS3 plays Blu-ray movies is to seek information about it, but if you're not interested in a video game console, you're probably not going to check out the details. As such, to non-gamers, the PS3 is just a 600 dollar video game console. Advertising certainly helps bring the news to some, but for everyone else, Playstation=video game console.
Can I prove my theory? Of course not; I haven't conducted a mass survey or anything like that. However, price has always been labeled as the biggest factor hurting the PS3. The price is bad for a video game console, but not for a Blu-ray player. That indicates that people are primarily looking at it as a video game console; if they weren't, the price wouldn't turn them off.
It's understandable that Sony wouldn't want to give up the Playstation brand, but if that's the case, they should have left out the Blu-ray. If they did, while Blu-ray would have slightly less support, the PS3 would have much more because it would be cheaper. It seems Sony is beginning to realize that its functionality as a Blu-ray player is not selling the PS3, given that they've released a Blu-ray player that's cheaper than the console. Now they have to find a way to make the console much cheaper. Even analysts who predict the PS3 will win the console wars tend to base that prediction on the system having a massive price cut; if Sony doesn't deliver, it will turn out very differently.
Designing their console in part to sell another product was a mistake, one from which they seem to have learned. Now they have to rectify it in order for the PS3 to be as successful as they want it to be. They can't offer an alternate model without Blu-ray, because games are also on Blu-ray discs, so they'll have to figure out something else.
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