It's so easy for some dweeb sitting in his living room to say what Sony should do, which is the impression I get from reading these inane comments.
Here's a reality check - Sony is the only console maker selling their machine for less than it costs to make it. Of the three, they are the only one that is under priced. To tell them they need to lose even more money with each console sale is purely idiotic, because it costs you nothing to say it, but it would cost them a lot to do it.
The reality is, the PS3 is still selling over 100,000 units a month, even at $399. If Activision doesn't have the programming talent to make games for it, that's an incentive for other makers since it leaves an opening. Also, costs for components DO go down, and Sony WILL lower the price when they do. Do you really think Activision will walk away from Sony knowing this? I don't, but if they do, they'll come walking back.
Also, ask yourself, would the $#itbox-360 sell as well as the Sony if it were selling for $399??? Clearly no. So, there are a lot of people that understand the value Sony offers, and the superiority of the product and services. Considering Sony really has weak competition - the Wii is a joke and really for a different market, and the $#hitbox-360 is an unreliable piece of junk with slightly inferior hardware capabilities, and a cost associated with going online, it's clear Sony is in a really good situation.
Their two problems - cost, and learning curve by programmers are both resolved by time. The strengths - better hardware and better features, are not ones that Microsoft or Nintendo can beat until they come out with a new console.
The PS3 is selling extremely well considering the cost in this economy. Even outside of that context, while 131,000 units is behind the Wii and $#hitbox, it's still a substantial amount that keeps the console relevant. When their costs come down and they can lower prices, and the economy recovers, it should really take off.
I'm reading now that Blu-ray will be costing roughly $50 to make very soon, and if that's the case, considering other component costs, it won't be too long until Sony can chop the price down, on their terms, instead of on the terms of people who know nothing about their business model, and probably too much about killing the evil Zargons.