The Yankee Group thinks that the PS3 will win the next generation console wars and end up on top. This makes me wonder: are they being paid by Sony, or are they all on crack? Seriously - I posted on this stuff just yesterday. Here's their take:

Yankee Group today revealed that despite intense competition from Microsoft and Nintendo, the Sony PlayStation 3 will lead sales in North America - though by a narrow margin. As a result of video game consoles’ emergence as platforms for digital distribution, Microsoft and Sony are engaged in a bruising battle for market dominance. Microsoft is off to a fast start, launching the Xbox 360 nearly 12 months before the PlayStation 3. However, by the time third-generation consoles reach market maturity in 2011, the PlayStation 3 will once again be the market leader.

Here's a key indicator for those guys: $600. That's the base price for a PS3 (and Sony will be taking a bath on each console sold at that price). It would not surprise me if the PS3 drove Sony out of the console business - but it would surprise me a lot if they managed to beat out MS.

Nintendo will be quietly profitable with the Wii, and I expect MS to grab the number one position. I expect Sony to take a severe beating from a cash perspective.

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