Sony slashes PlayStation 3 price
The group is launching a new slimline version of its existing model early next month, which will cost £249.99 compared to the current £299.99 price tag.
The move comes after PlayStation 3 (PS3) sales lagged behind rival consoles such as Nintendo, while the wider industry has also suffered from weaker demand amid the recession and lacklustre games releases.
Prices for the current PS3 model have been cut immediately.
Technology analysts said the price cut would be welcomed by retailers such as Game Group and HMV ahead of the key Christmas selling season.
Singer Capital Markets analysts said: "Clearly new hardware and a reduced price point is good news for the retailers ahead of the important Christmas trading season after a rather subdued summer with uninspiring software releases.
"However, at £249.99, the PS3 may still be perceived as expensive by many during the downturn and the price cut may not be enough to tempt those who have been hoping for a drop in price below £200."
Sony's PS3 is said to have sold 23.7 million worldwide since launch in 2006, although this compares to around 138 million for its predecessor, the PlayStation 2, according to Singer analysts.
They added that more than 80% of PS2 sales came after the price cut to £169 in 2002, two years after launch.
Games market experts expect other console makers to follow suit with price cuts, with Nintendo predicted to bring down the cost of its Wii, possibly by adding in free games on purchase.
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