According to market research firm, iSuppli, the manufacturing costs of the Playstation 3 have been cut by 35 per cent from $690 to $448.

"A portion of the cost decrease is attributable to normal learning curve and supply/demand factors that bring component prices down over time. A more significant factor is the clever integration of discrete components into the core silicon of the PS3, dramatically reducing the component count. The new generation PS3 contains an estimated 2,820 individual parts, compared to 4,048 in the previous-generation model with a 60Gbyte hard drive. This also dramatically reduces the overall cost of the console," reads the report.

The reduction in cost now means that Sony will only lose $48 each time a console is sold rather than $290. iSuppli believe that this could mean that the "PS3 may be able to break even in 2009."

Source :: iSuppli.com