That's $198, but that some months back. Odds are it's less now. However, with Wii's still selling above market price on eBay, it is unlikely that a PS3 price cut will have much measurable impact (though there is no way to tell how many people, seeing Wii's out of stock for the 65th consecutive week, would break down and buy a PS3). As soon as Wii's start staying on shelves, expect to see a price drop to $200, maybe even adding another game for extra value (Zelda, Metroid or Mario would be good to pair with WiiSports, in order to appeal to traditional gamers).

The 360 should be able to do a $100 cut on the Premium and Elite to match Sony, and get the Arcade down to $199. Again, a free game or two (real ones), and maybe some free DL content could sweeten the pot.

I would be amazed if PS3 gets to 300$ and I am not going to buy it because I can just wait one more year and PS3 will be even cheaper. I dont want to feel like I have spent extra several hundred $ if after I purchase the console it drops in price after a month or two. PS3 already went down in price pretty quickly from 600 to 400 and if Sony keeps slashing prices then not only they wont make a profit this generation but they will also make consumers wary of buying their consoles early.

Why pay 600$ now if you can pay 300$ in less than two years later. Not to mention the fact that the dollar has went down significantly which I think is already hurting Sony a lot.

1. Horrible marketing. The purple lunchpail made it tres uncool among the socially conscious young males that make up a huge portion of the gamer market, and a stubborn refusal to "spin" the GCN's stats led to the still-persistant belief that the Cube was a child's toy compared to the "more powerful" PS2 and XBox.

2. Horrible marketing part 2: Replaced "mature" Zelda with "Celda", which, while an awesome experience, was never given a chance by many idiots gamers. Then there was Mario Sunshine, which was a solid game, even if not up to M64 levels, but completely hamstrung by a juvenile marketing campaign: http://youtube.com/watch?v=0WPteMFkI2k

3. Games: Never got that killer app. Yeah, SSBM rocked, but it just couldn'tget the attention that Halo and GTA3 earned during launch. And, for reasons discussed extensively elsewhere, it consistently got the worst version of third party titles, leading to lower sales, which lead to less overall support by third parties (who WERE originally anxious to change their relationship with Nintendo after the N64 era).

4. No DVD: When the 'Cube launched, DVD had been out for 3 years and had penetrated the mass consciousness. Everyone seemed to want one. With the low end DVD players at $100, that easily offset the price difference between the GCN and its competition. Moreover,  leaving out the DVD and keeping the price low reinforced the "baby box" myth. Finally all 3 consoles cut price 6 months after the Cube launched, and that $100 advantage dropped to $50. It is no coincidence that in the US that price drop moved the XBox over the GCN in weekly sales from that point on (mostly, and usually by a narrow marin) (Note: The DVD explosion was unprecedented in the history of home entertainment. Those thinking that BluRay will move PS3's the way DVD moved PS2 are almost certain to be disappointed).

If it had stayed at $299, sales would have continued declining instead of increasing.  It has very much to do with price -- each time you lower the price, more people are willing to buy your product.

 Then don't by it. Wait a year, and the players will be under $200.

Just keep playing your Wii. (I know you don't have a 360, because if you like 360 games, the above statement is nothing but a fanboy dig).

I don't know any gamer that can look at R&C, Uncharted, HS, GT, MGS, FF, Haze, Resistance, LBP, and all the other exclusives, and say "nothing interests me"

I can see gamers looking at that lineup and saying it's not worth $400 to play them, but to say even if you had a PS3, you would not drop 4 bucks on a rental?

Not any gamer I have ever met. 

it will never reach wii like levels---it just dosent have the sae market or market appeal--the only people that will buy the ps3 and avid gamers--where the wii sells to both avid gamers and new gamers

Excellent point, FishyJoe ...  

yes but is Sony getting that desperate about PS3 sales?

um... no...

which price drop have you EVER seen that actually "hurt" sales????.......

people are forgetting the ps3 at its price is STILL out selling the 360....... sony will do this soon because they want market leadership not only for games but for blu-ray and if they lose money now its ok becasue games WILL sale (some are selling more on ps3 then 360 even NOW!) and blu-ray will take off......... if you think this will not happen this year yo are crazy