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LOS ANGELES - Sony will cut the price of the PlayStation 3 console in the United States and Canada by US$100 ($128) in a bid to double sales of the player, which has trailed rivals since its introduction last year.
Jack Tretton, head of Tokyo-based Sony's US games business, said a PlayStation 3 with a 60-gigabyte hard drive would sell for US$499, a 17 per cent discount. A new 80-gigabyte model will go on sale in August for US$599.
Sony is predicting the price cut will double US sales of the player.
Analysts said the move would take customers from Microsoft, forcing the Xbox 360-maker to drop the price of its US$479 Elite model.
Nintendo's Wii, the top-selling console at US$249, probably would not be affected.
"The price cut should take more away from Microsoft," said Richard Doherty, an analyst at the research firm Envisioneering Group in Seaford, New York.
"A lot of sales that would have gone to the Xbox Elite will go to PlayStation."
Sony made its announcement one day before the opening of the Electronic Entertainment Expo, or E3, conference in Santa Monica, California, where console-makers and game publishers announce new products for the coming year.
The conference opens today with a media briefing by Washington-based Microsoft.
Kyoto-based Nintendo and Sony have scheduled events for tomorrow.
Sony's news might spur Microsoft to respond by announcing a cut of US$50 to US$100 in the Elite's price at the conference, said Michael Pachter, an analyst at Wedbush Morgan Securities in Los Angeles.
"It pretty much forces Microsoft to cut."
Pachter said Sony's sales increase probably would be closer to 50 per cent than the doubling that Tretton forecast.
At US$499, the price of a 20-gigabyte model that was being discontinued, PlayStation 3 was still costly, especially when Wii was available for US$249 and Sony's own PlayStation 2 sold for US$129.
Sony would cut prices further as production costs continued to drop.
American consumers have bought 1.38 million PlayStation 3s since it was introduced in November.
That compares with 2.84 million Wii players, which reached stores the same month.
Microsoft, which introduced Xbox 360 a year earlier, has had sales of 5.5 million.
- BLOOMBERG
