Sony's efforts to turn around its struggling videogame unit during the last week have left mixed reactions, but one analyst believes that further price cuts to its Playstation 3 game console are inevitable.
On Monday, Sony announced it would stop shipping the cheaper, 60-gigabyte version of the PS3 to the United States, a move that upset some consumers only days after the company had decided to make price cuts to the video game units.
With the $499 version of the PS3 out of the way when the last unit sells out and only the $599 80-gigabyte model remaining, one analyst believes the company will add still another round of price cuts to compensate.
In our view, the Sony entry level price of $499 is here to stay, said Michael Pachter, an analyst with Webush Morgan.
Pachter believes there are nearly 3 million 60Gb PS3s in stock that have yet to be sold, and once that supply is depleted, the company will lower the price of its 80Gb model to $499.
Although we think that Sonyâ€™s public relations gaffe was unfortunate, we do not believe that the company has ill intent, and we expect the $499 price point to be maintained until early next year, when the 80Gb model will likely be cut again to $399.
The announcement comes as Sony is trying to shift negative perceptions around the PS3 in time for the crucial holiday shopping season.
In the first five months of the 2007, Nintendo has walked away as the winner with its Wii game console. Nintendo has sold 1.73 million Wiis in the United States, according to market researcher NPD Group. Microsoft has sold 1 million Xbox 360s and Sony has sold only 665,000 PS3s.