It doesn't really save them money to cut backwards compatibility, but it does inspire more sales of new software. That was actually their explanation. No one could believe they were so up-front about it.

When the PS3 first came out, they were saying how important backwards compatibility is, and how their competitor having less-than-wonderful BC was unconscionable. I guess the value of their PS2 library is a thorn in their side now, and it's time to cut that necessary feature. That being said, I never cared about BC. I get the new systems to play the new games, but when they're being such bulgeclutchers over it, it makes me sick.

So yeah, I'm fine with the new model. I'm just wondering how they can have such crap PR.