Playstation 2 Price Cut Drives Sales as Nintendo Talks New Console

Sony Computer Entertainment America Inc., which recently lowered the price of its PlayStation 2 gaming console to match the $149 price tag on Microsoft’s Xbox, says the move has resulted in a sales increase of more than 200% during the first week. The company announced the price cut last month at the Electronic Entertainment Expo (E3) in Los Angeles.

Sony has sold more than 26 million PlayStation 2 consoles in North America, and has shipped more 70 million units worldwide. Sony execs see the recent sales drive as proof that consumers are placing their confidence in the longevity of PlayStation 2, even as Nintendo announces that it is developing a new game console.

Though Nintendo previously used price-cutting tactics to sell more of its Game Cube consoles, the company hopes to better compete with Sony by producing something called Revolution. The Revolution game console is likely to be previewed at the 2005 edition of E3. Nintendo hasn’t released any details, but promises to deliver more than a faster chip with the new product, which it hopes will revolutionize the industry by offering "a new way to play games."

While lagging behind in console sales, Nintendo leads the industry in handheld gaming with its Game Boy Advance. That market will soon be challenged when Sony releases its much-lauded PSP (PlayStation Portable) unit. To keep its product offerings fresh and competitive, Nintendo will release the Nintendo DS (Dual Screen) version of the Game Boy in Japan later this year.