Microsoft’s Xbox 360 may finally get some serious competition from Sony this holiday season: Sony just announced that it is introducing a redesigned version of its PlayStation 3 — the “slim” model that’s been rumored for months.
Sony is also lowering the current console’s base price by $100, to $299.
The PS3 slim will go on sale in September for $299, with a 120 gig hard drive in its 33 percent smaller case. Microsoft’s standard 360 costs $299 and has a 60 gig drive.
Sony also announced at the GamesCom conference in Germany that it will add e-reader technology to its PSP handheld device, and introduce digital comics from Marvel and other publishers in December.
It may take more to reinvogorate sales of any console nowadays, however. Game sales have fallen for five months in a row, including a 37 percent drop in hardware sales last month, according to NPD. The research firm said Sony sold 121,800 PS3’s in the U.S. last month, while Microsoft sold 202,900 360s and Nintendo sold 252,500 Wiis.
Pricing – plus an initial lack of games – kept the PS3 a distant third in the race between the current generation consoles. Since it launched in late 2006, Sony sold 8.05 million units in the U.S. through July, compared to 15.73 million 360s and 20.89 million Wiis, according to NPD.
But Sony is upbeat and expects the PS3 will see a 30 percent sales increase from the combination of a lower price, hardware refresh and a strong lineup of games from developers who finally have the hang of the system’s unique Cell processor.
“We do expect a substantial lift,” said John Koller, director of hardware marketing.
Console price cuts have historically prompted a 40 percent to 60 percent month-over-month jump in sales, according to NPD toy and game analyst Anita Frazier.
But it’s also a gamble for Sony, which lost $1 billion in its last fiscal year – its first annual loss in 14 years – and expects to lose another $1.26 billion in the current fiscal year ending in March.
Koller said the PS3 was made smaller by using a new cooling mechanism, a new power supply and shifting to 45 nanometer chips from the previous 65. The size of the external power block is also reduced, and the system uses a third less power, Koller said.
Sony also did away with the power switch on the back, moving its function to the pause/resume button on the front. I’m just glad they added real buttons for pause and eject; on the previous model you just press lit but undefined spots on the case.
A Microsoft spokesperson wouldn’t say whether the company plans to cut Xbox prices in response but noted that its entry level model costs $199. (That’s without a hard drive; models with a drive start at $299).
“We do not believe today’s news will have a significant impact on Xbox 360 sales and our platform will be the entertainment center in the home for long into the next decade,” the spokesperson said in a prepared statement. “That said, Xbox 360 is a constantly evolving product and we remain focused on transforming home entertainment with another amazing lineup of blockbuster and exclusive games, new entertainment and social experiences through Xbox Live, and a whole new ways to play with ‘Project Natal.'”
Microsoft may have to do something new for the holidays. Its $299 console not only has half the storage capacity as the “new” PS3, it doesn’t have a Blu-ray drive like Sony’s console.
Not that many people use all the storage (or Blu-ray …) but the PS3 could look better to comparison shoppers. It also looks like a bargain compared to the $399, 120-gig Xbox 360 Elite model.
Mr. Slim’s ports, shown in closeups: