Sony and AMD cut prices to try to stimulate sales

Both Sony and AMD are cutting prices this week in order to try to stimulate sales.

Sony is cutting 17% off the price of the PS3 games console.  In real terms this means a price cut of $100, making the PS3 $20 pricier than the top-end Xbox 360 bundle (that is, unless Microsoft similarly responds with a price cut), but still more than double the price of the highly successful – and positively addictive! - Wii.  Sony expects that the price cut will double sales but others, such as Wedbush Morgan analyst Michael Pachter think that this might only boost sales by around 50%. 

This PS3 price drop has been anticipated for some time and while it's likely to annoy and irritate early adopters it will undoubtedly boost sales.  But I doubt that it'll double sales, especially against the strong Wii.  And if Microsoft follows suit and drops the price of the Xbox 360 by around the same amount, Sony might see little or no benefit from the cut.  But the PS3 suffers from another serious flaw that that this price cut won't solve –  and that's an absence of "must have" games. There's very little in the way of exclusive PS3 games that makes it worthwhile for anyone dropping that much cash on the console. 

Interestingly, this new $499 price tag for the PS3 was the same price that was denied, rejected and dismissed as a hoax by Sony over the past few weeks.  Funny how things turn out. 

AMD is also cutting up to 30% off the price of desktop processors.  Here are some of the highlights:

• 3.0 GHz Athlon 64 FX-74 down from $799 to $599 (25% cut)
• FX-72 remains unchanged
• Other Athlon 64 X2 cut by between 15% and 30%
• 10 - 15% off the Athlon 64 range
• Gone are the X2 3600+ and the X2 3800+ processors, replaced by the 65W and 89W 4200+

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Intel's price cuts are expected to be announced on 22 July.

Do you pay attention to price cuts?  Thoughts?