I have to disagree there although the price was a major problem.  However, if it were merely price alone
the Xbox 360 would continue to outsell, it has a larger library and is still priced lower than the PS3 (unless you get a special edition).

Sony made a great machine that was expensive to make from the start.  Initially they were losing 200-300 dollars per unit.  Within itself that wasn't a bad idea because it is better that the platform is rock solid with huge capabilities rather than cutting corners because if the platform is solid then you have so many possiblilities with the software, and the software is where the real money comes in.

The problem was they ported most of their titles.  Bad idea...for one thing you now had an expensive machine that seemingly was no better than it's less expensive competitor.  To make matters worse these were first generation games so even the ports were not as polished as they should be.  On top of that
developers were not familiar with the hardware yet and the games being developed suffered.  This has always been the norm from the very first Playstation but moreso the PS2...there has always been a learning curve but the end results have proved worthwhile.  Many people didn't believe the claims that the PS2 was using such a small amount of its potential at launch but go look at the first-generation games and then look at recent games like Gods of War II and I think we can say the claims were true.  The same will be the case with the PS3...wait until you see what the new Gran Tourismo is going to look like...then judge.

Then you had terrible marketing by Sony.  When the PS3 came out people were waiting for 6 months to get one.  We live in a world of instant gratification so what happened? ...  People bought what was available instead of waiting around for what "may be".

Had the PS3 came out with the sort of games that are out now it would have done much better.  I also think Sony should have found a way to lower the price a bit more to ease the "sticker shock" when the PS3 first came out.  It's actually an unofficial magazine (the largest Playstation magazine of the past decade) that really made the sticker shock even worse than what it would have been.  PSM magazine reported that they had information that the PS3 was going to have a pricetag of 399 (that is where it is now and will likely remain).  Being a reputable (and the largest) Playstation magazine made expectations of a price tag around 400.00.  When the pricetag of 599.00 hit this alienated a bunch of potential customers.

The games are now getting more and more impressive.  Also more great games will be Sony exclusives and that is key to the success as well.  The Blu Ray format has also officially been hailed as the winner of the HD format wars and that will also help.  Initially I think the name Blu Ray may have hurt a bit.  For the inexperienced shopper HD-DVD made sense...high definition dvd, but what the hell was a Blu Ray.  Now that problem is eliminated.  I think the between the PS3/Xbox 360 isn't over but we will see more and more PS3 gains in the coming months.  By the end of the year I think it will be the norm that the PS3 outsells the Xbox 360 but the Wii will remain solid I think.  It has a unique market thanks to some ingenious strategies by Nintendo.  They didn't try to fight with the "big dogs" for the high definiton supremacy (Xbox 360/PS3) they instead focused on what they know is their bread and butter...fun games that are simplistic and geared (for the most part) toward kids.  That's a smart company and why Nintendo has dominated for what seems like an eternity.