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@Rocketpig

The PS3 has only dropped $100 in price, but has removed two chips from its cheapest model, as well as having the price of the blu-ray laser come down. Thats everyones misconception, which is why I think Sony planned this out perfectly

60gb-599
20gb-499

80gb-499
40gb-399

Yet they have had multiple sales boosts so far from price drops that really werent price drops at all. Sony has dropped the price $50 more than Microsoft has. They have room to drop the price more, IMO, if they release the new cheaper PS2, and the PSP still keeps selling relatively well.

PS3 will reach 299 next year. I have no doubt about that