Completely eliminating the backwards compatibility with the PS2 means taking out the GS (Graphics Synthesizer, PS2's graphical chip), not the EE (PS2's CPU). The EE only exists in the 20 and 60 GB versions (except in Europe where it doesn't exist at all).
As far as I know, Sony has software for emulating the EE but not the GS, which is why totally removing backwards compatibility with the PS2 can save them some money. Last year, iSuppli estimated that the EE+GS combo cost them $27, so they can't be saving much money by eliminating the GS... It just shows how desperate they are to reduce costs.
So if this rumour is true, there'll exist:
- 20 and 60 GB American/Japanese PS3 with almost perfect PS2 backwards compatibility
- 60 GB PAL PS3 with software emulation for the EE component, meaning weaker compatibility (some titles don't work at all, some have flaws, some work fine) , but with the GS- 80 GB American/Korean PS3 with software emulation for the PS2 EE CPU (same as above), but with the GS
- 40 GB American (and maybe more) PS3 with no EE nor GS (no PS2 backwards compatibility)
Yes, it's getting confusing ;)
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