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Sony reduces price of PlayStation 3

LOS ANGELES -- In a move that could give video-game sales a much-needed adrenaline boost, Sony Corp. has knocked $50 off the price of its PlayStation 3 game console.

The price drop, announced at the Gamescom conference in Germany, applies to both the 160-gigabyte and the 320-gig version, which will sell for $249.99 and $299.99 respectively. The console launched in November 2006 at $499.99 for a 20-gig model and $599.99 for a 60-gig machine.

"The new price will make the PS3 more accessible than ever before," said Jack Tretton, president of Sony's PlayStation business, in a company blog post.

It's also expected to help sales of video games, which have been hammered by an anemic global economy that has caused consumers to pull back on discretionary spending. In July, for example, U.S. sales of console and computer games hit their lowest mark since October 2006, according to market research firm NPD Group.

Among the three major console manufacturers, Nintendo Co. has been hit hardest as demand for its Wii has dried up. Sales of Nintendo's newest console, the hand-held 3DS launched in March at $349.95, have been so lackluster that the Japanese company has been forced to chop the price twice, down to $169.99. That prompted complaints from buyers who paid full price just a few months earlier, and led to a formal apology from Nintendo Chief Executive Satoru Iwata.

Though sales of the PS3 have grown steadily since its introduction five years ago, Sony has not been immune to the current weakness in consumer spending. The company sold 145,000 PS3s in July, down from 215,000 a year earlier, when the platform got a sales lift from its last price cut in June 2010.

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