I don't think MS or Sony is making anything on the consoles yet.
MS lost tons of money when they extended the warranty on the 360.
Paying for the repair of all those consoles isn't cheap.
I think MS is hoping that in the long term, maybe with another console, if their is one, they will have enough market share to make a profit.
Sony may sell lots of ps3 as bluray players, but they are still losing money.
I guess they hope movie and game sales will make up for it.
Overall the pc could be the future of gaming, if you can get companies to put the development money into it vs spending billions on console development.
I also think lowering pc game prices could do wonders for the industry.
If they could drop pc games to 39.99 it would do a lot to encourage pc game sales. PC has high hardware cost, but if I can spend the money on the hardware, but get the games 20.00 cheaper than console it would be worth it.