bigger price cut than 50$ without a production cost reduction (chip shrink...) at same time would have probably pushed them back to making losses on hardware.
price cuts on the accessories would probably be more easy to do for them (the harddisk kits could probably easy be cut down to half price).
i don't think sony will counter immediatly with a drop, they will probably wait a bit and see how much effect that drop has (in europe it did not do much more than a peak and a very small continous effect). instead i guess they will try to counter it witht he 80gb bundles at start, and i guess we might see a ps3 price drop later this year once they swap to the shrinked cell & rsx (but also probably only 50$ but maybe with a bigger harddisk and Backward Compatibility in the base version).
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