Sony Slashing PS3 Prices in the US

Just last week, there were reports saying Sony has no plans to slash prices of its PlayStation 3 (PS3) gaming console.

And now there are reports saying the contradictory -- that the company is indeed lowering the price of its 60GB PS3 model in the US by $100, bringing down the price to $500. Reportedly, the price cut is a result of slow paced sales of the console.

Commenting on the price cut, Jack Tretton, chief executive of Sony Computer Entertainment America, said the initial expectation is that sales should double in the least.

However, industry analysts are of the view that the price cut will not double sales - probably boost them by 50 percent so as to reach a figure of about 120,000 units per month.

The price cut is also being seen as a counter measure to the growing popularity of rival consoles, including Microsoft's Xbox 360 and Nintendo's Wii.

A report by the NPD Group, a market research company, stated that as of May 2007, around 5.6 million units of Xbox 360 and 2.8 million units of Wii were sold in the US market; while only 1.4 million units of the PS3 were sold.

Since its launch in November last year, PS3 has always been criticized for carrying an expensive tag. Even after the price cut, the console continues to remain the most expensive Gen-Next gaming console.

Apart from the price cut, Sony has announced plans to introduce an 80GB PS3 model for $600 along with a copy of "Motorstorm," a popular off-road racing game.

Sony is hoping that it will also gain from the alleged high failure rate of Microsoft's Xbox 360. Tretton remarked that Sony is proud of the fact that its PS3 has the lowest failure rate for any PlayStation product.