E3 07: Hirai: 60GB PS3 "no longer in production"

SANTA MONICA, California--Last week, the E3 Media & Business Summit wound down in Santa Monica with at least one exhibitor having already packed up and left the showfloor at Barker Hangar. However, this morning saw the biggest controversy of the show heat up, with a maelstrom of confusion surrounding the US$499 price drop of the 60GB PS3, which was just announced Monday.

Last night, Sony Computer Entertainment Europe CEO David Reeves told CNET that the discounting was merely a markdown of a model which had been discontinued. Just hours later, his statements appeared to be contradicted by a senior Sony Computer Entertainment America spokesperson who said that quotes from Reeves in the press were "not accurate".

"As announced this week, SCEA's product offering in the US consists of an 80GB PS3 available in August at US$599 and a 60GB PS3 available now for US$499," SCEA senior director of Corporate Communications Dave Karraker told CNET. "We have will have ample supplies of both models to meet the needs of our consumers for the foreseeable future."

At almost the same time, a television interview with the global head of Sony Computer Entertainment settled the matter once and for all. Speaking to Norwegian game news outlet VGTV, SCEI president and group CEO Kaz Hirai said in no uncertain terms that the 60GB PS3's days are numbered.

"From a hardware perspective, the US$499 price adjustment we did for the 60GB version for the American market, we're no longer in production for that product," he said in an unedited on-camera interview. "Once that product is gone from the retailer shelves, then we're back to a US$599 SKU only, so it's not like we have a two-price strategy in the US market. We found out very early on how consumers react to having just one SKU as opposed to two."

SCEA has subsequently confirmed the phase-out, but emphasized that it would be gradual. "The 60GB PS3 will be available in the US for US$499 until supplies of that unit are depleted," Karraker told CNET in a follow-up interview. "We have ample inventory to meet the immediate needs of consumers in this territory for several months to come."

Karraker also responded to criticism that loudly promoting the new US$499 price point while quietly discontinuing its production amounted to a bait-and-switch. "This is absolutely not a bait-and-switch," he said. "We are offering a full-featured PS3 for US$100 lower than the original price and will do so for months to come, allowing consumers the opportunity to acquire this model at this adjusted price."