Sony's success in their television, consumer electronics and movie divisions have allowed it to post an operating profit of 32.29 billion yen for the first quarter of this year with revenues rising 11 percent, compared to a 6.8 billion yen loss last year.  Unfortunately, their games division did not fare so well, with a 29.1 percent year-on-year dive in revenue and 26.8 billion yen operating loss.

This decrease can be attributed to declining hardware sales for Sony's current gen PlayStation 2 and PlayStation Portable gaming platforms.  The high R&D costs and launch preparation tied to the upcoming PlayStation 3 certainly didn't help, and in fact were attributed as the key factors in undermining Sony Computer Entertainment's earnings.  While Sony has previously assured its investors the company will see returns in PS3 investment within 5 years, they caution that SCE as a whole risks facing bigger losses in the long run thanks to increasing costs for PS3 components.

The big gamble for SCE and indeed, Sony as a whole, will be Blu-Ray; if the optical disc format proves successful, the company stands to reap ample rewards for all their investment.  In this light, perhaps it's no surprise the PS3 costs ended up having the effect it did on the company's profits.  Part of the draw of the PS3 has always been its (relative) affordability as a consumer Blu-Ray device, so Sony will push that aspect of the console.  Blu-Ray and PS3 will certainly rely on each other for success in the long run.