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On July 6, 2007, this is the note I sent to Early Alert Trader readers:
“Four reasons to be bullish on Take-Two. (1) The possibility of gaming rating upgrades for Manhunt 2, which is slated for July 2007 release; (2) Grand Theft Auto IV’s release in October 2007; (3) a rumored $100 price drop on the PS3; and (4) exposure at the July 11 to 13, 2007 E3 2007 conference.”
At the time, the $100 price drop remained rumor despite Sony’s price cut denial on July 6, 2007. Now, in the latest sign Sony is struggling for control of the $30 billion market, the rumored price cut is rumor no more, bringing the PS3 to $499, ahead of the E3 2007 conference.
Considering lackluster PS3 sales (1.4 million sold through May) amid heavy competition from Microsoft Xbox 360 (5.6 million sold through May) and Nintendo Wii (2.8 million sold through May) operating systems, the move is a good one. And despite reports of the “surprise” price cut, there really was no surprise for a console priced out of comfortable consumer price ranges. Sure, it’s Sony. But who wants to pay $200 more for a console when they can go to company B and get a similar product for less?
While the price cut may also force Microsoft’s hand in cutting the Xbox 360 cost, the company’s Japanese subsidiary has already said there were no plans. But that’s the same thing Sony said just days before cutting the price, too.
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