I completely agree on the cost factor. The PS3 system should be cheaper (Even when factoring in you need both Eye Toy + PS3 Wands) to achieve something approaching what Natal is possible of doing.
And yes, I'm pretty certain certain that MS will have to use this as a loss leader. I just don't see very many ways for them to get the costs down in such a way that the system performs as they claim. Sure the camera systems (visible light + IR) may be cheap. The microphones certainly are cheap. And perhaps each individual component that will do the actual processing may be cheap. But put that all together and it probably won't be a non-trivial cost.
MS's hope/gamble here is that the system provides such a revolutionary experience that it manages to move consoles in Wii like numbers (historically speaking since we don't know if Wii momentum will continue as it has in the past).
And unlike Wii, there are more titles than just a few first party efforts that hit the top of the charts. Meaning they could just be looking at the potential of selling a whole lot more software...
One problem I see is that if the user base is expanded using a similar demographic to the Wii userbase. Will they have the same sort of problems moving traditional type games to that demographic?
But yes, overall, I absolutely agree that I don't see a way that Natal will be cheaper to manufacture than Eye Toy + PS3 Wands. But I think MS is not only more willing but certainly more capable of eating the cost if it see's an possible overall cost benefit.
As to processing requirements that's where we'll have to agree to disagree.
Since we don't know many hard details on the system yet. We can't know things such as.
Likewise just how well does it track multiple people? And how many multiple people can it track. If it's tracking 48 key points per person and there are say 4 people in the camera field of view (getting crowded here
) will it still be accurately tracking 192 key points 30 times per second?
And that's just some of the considerations...
Depending on how advanced or how simplistic they go, would determine (IMO) whether the Eye Toy + PS3 wands + PS3 doing all the computations would be able to mimic it in some way.
Regards,
SB