E3 '07: 60GB PS3 $499, 80GB due in August

[UPDATE 2] Sony confirms price drop, says new $599 model bundled with MotorStorm coming next month--and will use software for backwards compatibility.


SANTA MONICA, Calif.--Today, Sony confirmed to GameSpot that a fusillade of reports from US retailers had augured last week. As of July 9, the PlayStation 3's North American price point is going south. The next-generation console will cost $499 in the US and $549 in Canada, the same price as the discontinued 20GB model.

So far, the price drop is for North America only. "This news does not affect any other PS3 territory," said Dave Karraker, Sony Computer Entertainment America. However, a spokesperson for Sony Computer Entertainment Europe added, "We are making an announcement at E3 on Thursday which will be related to SCEA's announcement."

The new 80GB PS3 bundle.
The new 80GB PS3 bundle.

The price drop announcement was accompanied by more unexpected news: The 80GB PS3, previously only available in South Korea, is also headed stateside. The larger-capacity system will go on sale in August for $599, and will have all the functionality of the 60GB model except backwards compatibility hardware. Sony Computer Entertainment America CEO Jack Tretton confirmed to GameSpot that the 80GB PS3 will instead use software emulation to play PlayStation 2 and original PlayStation games.

To help stifle complaints that $100 might be a bit much to pay for 20GB more of hard disc space, Sony is releasing a "limited edition" bundle which packages the console with the off-road racer MotorStorm, which currently retails for $59.99.

The price drop further indicates that, after a slow start, Sony is now aggressively trying to expand its customer base in the US. The move comes none too soon. According to the latest figures from industry-research firm the NPD Group, the PS3 sold only 82,000 units in the US in May, compared to the Xbox 360's 155,000 units and the Wii's 338,000 units. Ironically, the console's predecessor, the PlayStation 2, was the month's fourth-best-selling platform with 188,000 units, just behind the PlayStation Portable's 221,000 units.

Will the $100 price drop turn the PS3's fortunes around? "Even with a $100 drop, the PS3 is still the high-end console," Lazard Capital Markets analyst Colin Sebastian told GameSpot. "But price cuts typically generate incremental demand, and I don't think this situation will be any different. Bottom line, this may not be enough to kick-start PS3 sales into the mass market--but it's a good first step."

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