PS3 “Price Drop”

I assume that anyone who goes on the Internet on a daily basis has already heard that Sony announced a $100 price drop to their Playstation 3 console, effective immediately. If you haven’t heard, now you know.

I don’t think the move requires much commentary. It is fairly obvious that Sony must be in trouble… never before in Sony console history (and I venture to say any console’s history), has a price drop been effective so soon after launch. This announcement comes only 8 months after the PS3 was released, and the price drop is rather substantial. $100 represents a 16.6% price drop. With the sales of the system coming to a near halt in the past two months, the move to cut the price seems logical. The amount of sold units has been at 3.5 million for quite some time with not much change.

In combination with the well-received E3 for Sony and this new price drop, not to mention the slew of incoming fall games, I expect the Holiday 07 season for Sony to be a very nice one. 360 better watch out, while Wii needs to keep bringing in games to attract more consumers.

What most people don’t realize about the price drop, however, is that it is only in effect as long as 60GB versions of the console exist. That is, the $100 price drop is for the 60GB SKU only, which Sony has halted production of. They claim that there is still enough supply for a few months, but that is based on their current sales rate… which should be noticeably increased as a result of the price drop. Once all of the 60GB versions are gone (or on August 1, whichever comes first), Sony will be releasing an 80GB version for the original price of $599.

It kind of ruins the point of a price drop if it will be not noticeable in potentially less than half a month. Once the 60GB versions are gone, you will still have to shell out $599 to get a PS3, since the 80 gig version will be the only one around. I think the choice to go with 80GB, as opposed to say 120GB, is a stupid choice. Why don’t we just make an advertisement showing that 360 has 40GB more space than us? (Consumers aren’t going to care that the 40GB, or even 120GB, means practically nothing in the world of HD video.) Furthermore, what is the point of the price drop at all? To liquidate a million units really quick? If they are so interested in selling consoles, why don’t they let the price drop stick and sell a million units every 2 weeks until Christmas?

The choice is interesting, but despite this, it still remains that they have plenty of good games coming soon and their E3 demonstration was considered the best of the three main console companies. One interesting thing to note is that Unreal Tournament 3 (formerly 2007) is going to be PS3 exclusive as far as consoles go (there will still be a PC version). The reason? Not only are the developers more excited about Sony’s system in terms of power, but get this… The Playstation Network offers more flexibility. That’s the same PSN that is allegedly inferior to Xbox Live. And while I think all gamers realize that Live continues to offer much more, the PSN has some tricks up its sleeve… like allowing UT3 to have downloadable mods. Every time a game like Oblivion or UT comes out, you know its going to be heavily modded. Until now, to enjoy that you would need the PC version. The revelation that the PSN network is capable of distributing mods and other user-created content really makes it attractive… the PS3 is even closer now to a PC gaming platform.