NGP/PSP 2 is gonna be increadibly expensive

1. Sony wants to undercut the 3DS's sales - so they will want to have a $299 sku available, if not at launch then soon after. [b]The PSP2 honestly shouldn't cost that much to manufacture. Apparently the iPad cost around $259 to manufacture (way back in April of last year) and it has a much more expensive screen ($97 each) and an extremely large very expensive battery as well as 16gbs of flash storage which isn't cheap either. Back in April of last year, the cpu and gpu in the iPad were pretty much cutting edge. The PSP2 will in all likelihood cost Sony less than that to manufacture.[/b]

http://www.electronista.com/articles/10/04/07/apple.still.keeps.margins.on.tablet.costs/

2. At the same time, Sony does want to recoup some of the R&D costs early, so there will be a premium $399 sku at launch, and it will almost certainly be manufactured at much larger quantities than the $299 sku until supply surpasses demand. Why should Sony sell the bulk of the PSP2's for $299 at launch when the product will be in very high demand and due to shortages, most of those sold will wind up on ebay anyways at a significant mark up?

3.Both skus will come bundled with a voucher for a free Sony movie download, a free ps1 game download, and a free psp/psn game download from sony's playstation store. Why? Because it's a cheap way to get people used to the idea of downloading ps1 and psp games, and movies onto the device. The first online purchase is always the hardest one, because people are hesistant to take that first step. By offering the first download for free, Sony can get a lot of people use to idea of purchasing digital content, and particularly their favorite ps1 and psp games and hope that people keep it up. At the same time, it will go further in justifying the $50 or $150 premium price over the 3BS.

Based on these factors, I forsee $299 sku with a wifi only PSP2 and 4gbs of flash, and a $399 premium sku with a 3g/4g PSP2 and 8gbs of flash.

The cheap $299 model will be pushed out in very very limited quantities, until supply outstrips demand. It's there initially just as a bullet point to convince people not to buy a 3DS over christmas, and instead lay down an extra $50 to get a real handheld.

Sony will want to manufacture and sell mostly $399 models over christmas when they likely won't be able to produce the consoles fast enough. So good luck finding the $299 version unless you preorder it early