Another price cut appears imminent for the PlayStation 3 and can’t come soon enough for Sony, given the latest news from its rivals Microsoft and Nintendo.

Industry executives believe Sony is about to announce a $399 version of the PS3 to coincide with the holiday season in the US. It currently offers an 80-gigabyte version for $599 and a  60Gb one for $499. There are reports that a 40Gb version will be offered in the UK for £299.

PS3 sales have lagged far behind those of Microsoft’s Xbox 360 and the Nintendo Wii and the gap could widen if Sony does not take action by cutting prices. Microsoft said yesterday that initial reports from retailers worldwide showed 360 sales, after the launch of its Halo 3 game on September 25, had nearly tripled compared to their weekly average.

Microsoft reported more than $300m in Halo sales worldwide in its first week. More than 2.7m gamers played it on its Xbox Live service in that period - nearly one-third of the worldwide membership of the online service.

Meanwhile, Reggie Fils-Aime, president of Nintendo of America, has told the San Jose Mercury News that the company will not be able to keep up with demand for the Wii this Christmas.

"We’re working very hard to
make sure that consumers are satisfied this holiday, but I can’t
guarantee that we’re going to meet demand. As a matter of fact, I can
tell you on the record we won’t," he said.