Someone please correct me if I'm wrong, but my understanding was that Sony licenses the discs to the publishers, so in fact to Sony the discs do cost next to nothing (in which case you'd want to include the price of developing/manufacturing the console to make the discs not "cost nothing," not the cost of developing the games, which is on the publisher).

Indeed, however the time and money isn't at the cost to Sony. Sony takes a cut of revenue from game sales.

I think he's just commenting on the marginal cost of selling an additional unit after production.

They don't cost Sony anything to spit out, but Sony takes a big cut of the sales.

Developers even have to pay Sony for hardware, SDKs etc. to develop the content.

But Information Wants to be Free! If can duplicate it cheaply, it shouldn't have a price and no one should get paid for it. They can make money from selling t-shirts instead. You shouldn't expect to make a living just for creating things. /s