Playstation 3

Sony really, really needs to crank up Playstation 3 sales. Video games are a huge money-maker to begin with. Plus, the company needs to get more Blu-ray high-def video players on the market to win the war over HD-DVD. Nintendo’s Wii has been outselling Playstation 3 almost two-to-one. Sony decided to spur demand with a price cut:

Sony Corp. slashed the price of its current PlayStation 3 by $100, or 16.7 percent, and introduced a high-capacity model in an effort to spur sales of the struggling video game console.

Starting Monday, the current 60 gigabyte model will cost $499, down from $599.

The Japanese electronics maker also said it is introducing a new version of the PlayStation 3 with a bigger hard drive for storing downloaded content such as video games and high-definition movies.

The new PS3 increases the system’s storage capacity to 80 gigabytes from 60 gigabytes and also includes a retail copy of the online racing title “MotorStorm,” a company spokesman said. It will be priced at $599.

Sony’s production cycle probably isn’t at that point where it’s making money off the consoles. This price cut will cut into the company’s margins. But not extending its video game dominance for another generation is something the company doesn’t want to ignore.

Sony Cuts PS3 Price by 16.7 Percent”