Sony has cut the price of its Playstation 2 console by 13 per cent in order to increase demand for the device following the company's PS3 announcement.
The move brings the price of Sony's console down to USD 130 from the previous USD 149 price point. It was not a secret that Sony would reduce the price of the Playstation 2 ahead of the expected November 2006 release of the PS3. The Japanese electronics giant has kept details of PS3 pricing a secret this far while most analysts agree that Sony may use E3 to issue the first PS3 pricing "hints".
Sony's last PS2 price cut took place in June 2004 and saw the price of the console fall from USD 179 to USD 149. Manufacturers usually reduce the price of their current consoles when a new version is announced as a means to drive sales demand. The U.S. video game market is struggling this year as interest in current generation consoles wanes.
In the past price reductions by one company have led to similar moves by their rivals. This time however, Microsoft intentions are harder to decipher as the company already has its next generation console out. It is possible that reducing the price of the XBox may affect, adversely, XBox 360 sales and competing with PS2 may not be foremost on MS executives' minds. Having sold over 101 million units globally, since its launch in 2000, PS2 is the undisputed winner of the previous generation of console wars and it is likely that MS would wish to shift attention to the next-generation of video game machines.
