Gamasutra reports on comments from a Japanese analyst group, characterizing the pre-launch price drop for the Japanese market as ridiculous. From the article: "Meanwhile, Naoki Fujiwara of Shinkin Asset Management suggested that the price reduction was 'negative for the short term because the company may not be able to sell enough consoles to cover an instant loss caused by the price cut.' The PlayStation 3 was already expected to be sold at a loss, with Sony allowing up to five years to recoup the costs. Shares in Sony fell 1.9 percent following the announcement, although this coincided with a generally poor day for the Tokyo Stock Exchange and may not be entirely related to the price cut."

An anonymous reader writes "In a surprising admission, Sony Computer Entertainment President Ken Kutaragi acknowledged that Sony's strength in game hardware might be in decline. BetaNews has the article, which reports on Sony's PS3 struggle for the holiday season." From the article: "In an extraordinary public statement of regret and despair over having to postpone his company's PlayStation 3 debut in Europe and Australia until March, and to limit availability elsewhere to only 500,000 units come November, Sony Computer Entertainment President Ken Kutaragi is quoted by Reuters as having told reporters, 'If you asked me if Sony's strength in hardware was in decline, right now I guess I would have to say that might be true.'"

Yasser writes to mention the fallout from yet another Sony battery recall. Sony's stock hit a one-month low today on the news that they'd be pulling over a million batteries off the market. The recall is expected to have little impact financially, but has prompted the Japanese government into ordering Sony to look into the battery problem. From that article: "The ministry instructed the two companies to investigate the safety of Dell models Latitude, Inspiron and Precision and report on their findings by the end of August, the ministry said. Earlier this month, problems with battery cells supplied by Sony forced Dell to recall an unprecedented 4.1 million laptop batteries in the United States. "

Chris Kohler, over at Wired's Game|Life, had the chance to see an in-production PS3 game in action. He said that, for the most part everything looked great. The one thing that concerned him was the motion-sensing controller that Sony is pushing on developers. From the article: "The developers told us that although we'd be using real PS3 controllers, they didn't yet have the motion-sensing functionality built in. And not only that, although they referred to the build as 'feature-complete,' they did admit that the one feature that was not yet included was (wait for it) motion-sensing, although they did 'have some cool ideas.' There was plenty of speculation after Sony's E3 conference that the motion-sensing functionality was jammed into the controller at the last minute as a reaction to Nintendo's strategy. This was backed up by the Warhawk developers' offhand remarks that they'd implemented motion sensing 'in just a couple weeks'."

TimAbdulla writes to mention a Wired article wondering if Steve Jobs has lost his magic? The keynote yesterday, author Leander Kahney says, was the most uninspiring he's yet seen out of the usually charismatic man. Accompanied by other folks from within the company, Kahney wonders what lackluster showings like this will mean for the company after Jobs steps down. From the article: "Looking very thin, almost gaunt, Jobs used the 90-minute presentation to introduce a new desktop Mac and preview the next version of Apple's operating system, code-named Leopard. The sneak preview of Leopard was underwhelming. For what seemed an interminable time, Jobs and Co. showed off one yawn after another. There's no way I can get excited about virtual desktops or a new service that turns highlighted text into a 'to do' item. Oooo."

douder writes "Windows Vista will have a new 'previous versions' feature when it ships next year. According to Ars Technica, the feature is built off of the volume shadow copy technology from Windows XP and Windows Server 2003. Now turned on by default, the service stores the modified versions of a user's documents, even after they are deleted. They also report that you can browse folders from within Explorer to see snapshots of what they contained over time. It can be disabled, but this seems like a privacy concern." From the article: "Some users will find the feature objectionable because it could give the bossman a new way to check up on employees, or perhaps it could be exploited in some nefarious way by some nefarious person. Previous versions of Windows were still susceptible to undelete utilities, of course, but this new functionality makes browsing quite, quite simple. On the other hand, it should be noted that 'Previous Versions' does not store its data in the files themselves. That is, unlike Microsoft Office's 'track changes,' files protected with 'Previous Versions' will not carry their documentary history with them."

NevarMore writes to tell us eWeek is reporting that Microsoft, after almost 30 years of Windows, now has 12 philosophical tenets outlining Windows development. From the article: "Smith said the principles largely come from things Microsoft picked up in the consent decree the software giant signed in settling its landmark antitrust battle with the federal government, but that more recent developments led to the crafting of some of the other principles. The 12 principles are based on three main areas: choice for computer manufacturers and customers, opportunities for developers, and interoperability for users, Smith said."

Lots of tidbits about Microsoft's next-gen console floating around this week. On Monday, the company revealed that almost 60% of 360 owners are now using Xbox Live. GameDaily discusses what is making their setup so dang popular. Major Nelson's Sunday podcast included a lot of details on the 360's approach to HD-DVD. HD Beat has the rundown on what was said, including the inevitable Sony smack-talk. Finally, Gamasutra has a feature on the 360's position in Japan. A group of analysts debate whether or not the system even needs Japan in order to be a success. From this last article: "I don't think that American gamers are enamored [with] Japanese product because it comes from Japan; rather, I think Americans like good games, regardless of the country of origin. Microsoft doesn't need Japanese development to succeed in the U.S.; it needs good games, period."

simoniker writes "DFC Intelligence's game analyst David Cole has released a new report on the next-gen video game market, and he's especially harsh on PS3 plans: 'The high price of the PlayStation 3 is going to slow overall industry growth, especially for software,' and '...if Sony does not change its current strategy for the PS3 the system will probably end up in third place in installed base.' He also suggests that 'the PS3 would be more than 35% of the monthly household income' of average families in some world territories. When will the backlash end?" The bottom line is that, even if they ramp up to 200,000 units a month starting this month, they're still not going to hit their 2 million unit goal in time for a November launch. Shortages and the high price tag will mean this is going to be a very weird Christmas console season.

Sometime in 2000, Sony patented a process that would 'verify a disc as legitimate, register the disc to that particular game console, then wipe out verification data so the disc would be rendered unreadable in other PlayStations'. Despite unrest in the gaming community over this technology, the company has repeatedly stated they have no plans to use it in the PS3. The LA Times explores this persistent debate, examining why Sony developed the tech and why gamers are nervous. From the article: "Whatever Sony's plans, the tempest [over the patent] illustrates the changing nature of ownership as millions of people accumulate vast collections of digital entertainment. Few people realize that when they buy software or music or movies, they are actually buying a license to use, watch or listen. That's why it violates copyright laws for people to sell copies of their music collection." Thanks to 1up.com for the link.

GeekGod writes "Images of an Xbox 360 motherboard with HDMI-port have been leaked on the internet. So it looks like Microsoft will follow into Sony's footsteps and release an Xbox 360 with a digital video output. This might also come in handy for their future HD-DVD addon, certainly when movies will get HDCP-protected."

ImaNumber writes "When Sony announced the price of the PS3 many people were left dumbfounded at how expensive it was going to be. Microsoft joked that people would get the Xbox360 and the Wii instead. Brittlefish has taken this a step further and put together a list of some other gaming 'bundles' that you could buy instead of just getting one PS3. You might be surprised at what you can get for that kind of money."

Next Generation has an article looking at games that could save the Xbox 360 in Japan. Despite Microsoft's best efforts, the console is still puttering along with lackluster sales. Even with the country's diminished interest in the PS3, the 360 needs some big-name titles to get it back into the minds of Japanese consumers. From the article: "Blue Dragon is set up to be another stick of dynamite with Toriyama's name written on it, though how willing casual fans will be to pick it up depends entirely on its advertising campaign. In America, it's becoming a simple enough strategy to put a demo of something on Xbox Live and let it spread through word of mouth. This is not so possible in Japan, mostly because most people here don't have an Xbox 360. Polls for months have indicated that the majority of casual gamers would reserve their judgment of the 360 for when they could play Sakaguchi's games."

mattaw writes "The Register is carrying a report that all 25 member states of the EU have found Microsoft guilty of non-compliance, off the record. Microsoft is in line for a fine of $2.51 million per day backdated to December 15th 2004 for failing to meet the terms of the EU commission's ruling."