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Sony to cut PlayStation prices in EU, Australia

Sony Corp, the world's largest video-game maker, will cut the price of its PlayStation2 console in Europe and Australia today, to give it an edge over Nintendo Co and Microsoft Corp as Christmas shopping begins.

Sony will cut the UK price 26 percent to ?200 (US$295).

The price in Australia will drop 33 percent to A$500 (US$243).

Prices will also fall in France and Germany.

The company is competing against Nintendo's GameCube console, which debuted in Japan two weeks ago, and Microsoft's first game machine, Xbox, to be released in the US in November.

``The price cut is intended to raise sales momentum for the Christmas season,'' said Koichiro Katsurayama, a spokesman for Sony's game unit, Sony Computer Entertainment Inc.

``The Christmas shopping season in Europe starts early.''

Sony has shipped 17.9 million PlayStation2s since March last year, when the game console debuted in Japan. Sony in June cut the domestic sales price to ?35,000 from its ?39,800 debut price.

The company has shipped 7.3 million units since the April 1 start of its fiscal year, 37 percent of its 20 million unit target for the full year through March.

Sony's game operations aren't profitable yet, as costs of development and production of the machine still outweigh sales.

The company expects the game division to become profitable in the second half of the fiscal year.

Even so, improvement in the game business isn't likely to boost overall earnings this year, analyst said, because of an expected loss on its electronics business.

``We cannot afford to expect an upward trend in PlayStation2 strong enough to offset the downtrend in the electronics operations,'' said Masahiro Ono, an analyst with UBS Warburg Japan Ltd.

Sony posted an operating loss of ?3.1 billion on its game operations for the three months to June 30, on top of an ?807 million loss on its electronics business.
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