Whether this is true or not, Microsoft is pretty smart for suggesting the PS3 will be $399 by Christmas.

We really don't know how many 60GB PS3 systems need to be sold before the $599 SKU is the only PS3 that is available but (for argument's sake) assume they have enough systems to last until September 1st.

The suggestion of a $399 model from a 'respected' source will spawn all kinds of rumors and news stories (and endless blog posts). In september when anyone even Googles "PS3" they will be forced to read this speculation; some people will even misunderstand the articles and assume the manufacturer of the PS3 was announcing a price reduction (either they think Microsoft produces the PS3 or they have a brain fart and misread Microsoft as Sony). The result of this is people begin anticipating a price drop on the PS3 and hold off buying more systems ...

This puts Sony in a bad position, either they reduce the PS3's price again (start looking desperate by reducing the price of the PS3 twice in 1 year) or they lose the sales of people who misunderstood Microsoft's intentions.

Not if the sony blog has anythig to do with it, you ask them something they do it. Sony is making in game xmb becuase of the blog, and they are realeasing the heavenly sword demo tomorrow becuase of the blog asking for demos, hehehe ;)

But if they do sell a 40gb for $399.99 like sqrl said it will be a huge success doubling the sales from they are at curretnly at the least and even coming close to the wii.

I don't think they'd remove all backwards compatability, that'd be stupid. Especially considering how we Europeans (excluding myself) kicked off when we thought we were getting reduced compatability (which really isn't the case anymore).

Yeah this is also true... This is like Sony telling everyone that Microsoft is going to reduce the price of the premium to $249 to compete with the Wii. While it has a tiny chance of being true, it will get people thinking enough to NOT buy a premium, because they don't want to get ripped off @ $399...

This would make perfect sense for Sony. What they are doing is releasing a $400 dollar BR player with the PS3 name. People looking for a BR player for the holiday season will pick up the cheapest one available, which happens to be a PS3. Therefore, Sony sells a lot more PS3s.

Lmao!! Your right, BD games, BD movies. Nice blu-ray player and it has internet.

But that's only true because HDD prices continually fall and storage demands continually rise. This same statement two years from now would be "I'd rather buy an 80GB model than a 40GB model".

...and this new model will be named the "BR3"!

It plays movies, but did you know it also plays games?