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Sony has sparked a video games console price war by slashing the cost of the PlayStation 3 in the United States by $100 (£48) or 17 per cent after fierce competition from Microsoft and the Nintendo Wii.
The PlayStation 3, which comes complete with a 60-gigabyte hard drive and Blu-ray high-definition DVD player, will now cost $500 in the US.
This is only $20 more than Microsoft Xbox 360 but still double the cost of the top-selling Nintendo Wii.
It is understood that the Japanese group will introduce a similar cut in the UK, where the PS3 costs £425, later this week.
A spokesman for Sony UK said: “There will be an announcement about PS3 and value for the consumer on Thursday.”
The price reduction in the US was due to be announced later this week during the industry’s annual E3 trade show in Santa Monica, California but leaked out early.
Both the Microsoft Xbox 360 and Nintendo are outselling the PS3 in the US several times over despite its popularity elsewhere in the world.
Jack Tretton, the chief executive of Sony Computer Entertainment America, said that he expected the price cut to double sales “at a minimum”.
He said: “We’ve gotten our production issues behind us on the PlayStation 3, reaching a position to pass on the savings to consumers, and our attitude is the sooner the better.
“We’re especially proud of the fact that the PlayStation 3 has the lowest failure rate of any PlayStation product.
“It’s absolutely the gold standard.”
The move comes just over a year after Sony was forced to delay the launch of the console by six months because of technical hitches linked to the Blu-ray disc drive.
The European launch was then put back a further six months, until March this year, due to production problems cutting supplies.
Industry experts had widely expected the price cut despite comments last week from Ryoji Chubachi, Sony's president, that there were no immediate plans for such a move.
Analysts believe that it is more likely that the cut will push sales up by about 50 per cent to 120,000 units a month.
Sony is also introducing a new more expensive version of the PS3 featuring an 80-gigabyte hard-drive, priced at $600. It is being aimed at gamers who download material from Sony's fast-growing online network.
Microsoft is predicted to respond with price cuts of its own this week. It has ruled out a move in Japan.
Sony launched its first PlayStation in Japan in 1994, breaking the dominance enjoyed at the time by Sega and Nintendo.
To date, more than 50 million PlayStation consoles have been sold worldwide.
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to the person who said the xbox runs at 1080i.. you do realise many recent games(since the spring update) can run at 1080p now?
Karlos, Paisley,
To be fair a lot of that 50% premium is thanks to our preposterous VAT, and applies to all electronic goods not just Sony's.
Fish, London, UK
to date sony has sold over 100 million ps2 so how can they have sell only more than 50 mil. i know that 100 is more than 50 but you should have said that to date over 100 million sony console has been sold worldwide
danny, seychelles,
Great but when will we see a good choice of 1080p quality games ? I bought the PS3 soley for its graphics along with a 1080p TV and now it sits in the corner while the X box 360 dominates with great quailty games at 1080i
michael higgins, Stockton on Tees, Cleveland UK
I agree entirely, it is obsene that any company in the new global market place should have different prices for different Countries.
So I will not be buying this or any other Sony product ( having been a long term Sony supporter) in the future.
James, Hythe,
For the same bloody machine, it's not even that, UK version is cheaper to make with no hardware emulation. Besides, I bet we don't get the same price cut..
b, donny, yorkshire
Given that you could buy a decent PC for the same price I won't bother... just yet. Keep the price falling and I could be persuaded.
Martin, Glasgow,
Sure it is more expensive than the XBox and the Wii, but with a Blu-Ray drive, free access to the PS store, a 60gb hard drive and wireless controllers - the PS3 represents decent value for money now. All gamers need now are...well... games!!!
Rob, Birmingham,
I think that he meant if you include the HD-DVD player into the equation.
Blurgh, Blurghville,
If Sony cuts the price in the UK market it still wont be enough! Sony has been ripping the UK consumer off for years. The price that the PS3 is available for at the moment is well above what consumers in the US and Japan pay. The UK consumer is not stupid, we all know that we are charged the highest prices because Sony see us as an easy target. When they lower the price in the UK it still will not be near the prices that other consumers pay abroad. It would be probably be just as cheap to fly to say New York on a cheaper flight have a short break and pop back with a US machine. When will Sony learn?? I say wait another 6-12 months and see the machine go down in price again, Sony is in a war of domination and the only way they can win is to make the product more affordable for the mass market consumer.
Paul Cowling, London, UK
"To date, more than 50 million PlayStation consoles have been sold worldwide"
It's actually more than 225 million.
Just $20 more sounds like a bargain to me for a far higher spec console that doesnt self destruct.
Steve, Remington,
Umm, if the $500 PS3 is only $20 more, how is the 360 $299 for the core and $399 for the premium. I make the $200 and $100 more expensive.
A Hart, Birmingham, England, UK
In the United States the PS3 will now cost $500. Given the current rate of exchange that's about £250, yet the UK price is £425 or $850 - and the UK PS3 has a lower spec than the U.S. version.
John, London,
$500 = £425?? This is a joke, somebody needs to take this to the European court...
Roger, Birmingham,
If Sony drops it price too £300 to £350 then I would be buying one
Gareth, Wales,
Hear Hear!
Julie, Stevenage,
As long as Sony charges me over 50% more in the UK than the US for the same bloody machine, I won't be buying one.
Dan, Hampton, UK