David Cole (of DFC Intelligence) has published an analysis of the Playstation 3. It’s well-written, so I thought I’d share parts of it with you:

We emphasize that there is a great deal of uncertainty because much will depend on how individual players execute their strategies over the next several years. However, two things are clear: 1) the high price of the PlayStation 3 is going to slow overall industry growth, especially for software and 2) if Sony does not change its current strategy for the PS3 the system will probably end up in third place in installed base. Microsoft and Nintendo have been handed that golden opportunity and both companies have a chance to make their systems the market leader. However, it looks like under any scenario the video game market is going to be severely fragmented, with several incompatible platforms having strong market share and even the possibility of a platform doing well in one region and struggling in another.

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