Sony Launching Low-Priced PlayStation 2 in 2008

Sony is employing an unexpected tactic in its struggle with rival console makers Nintendo and Microsoft by launching a new, low-priced version of the PlayStation 2 in the new year.

The system, set to hit the market in early 2008, is expected to retail for $99 in North America. The reduced price will come largely as the result of the system's built-in power supply, which will allow Sony to manufacture the unit more cheaply. The current "slim" PlayStation 2 model requires an external power supply, resulting in higher production costs.

The news follows reports of a new PlayStation 3 model for North America and Europe, which is also being sold at a reduced price. Among other changes in the design, the new PlayStation 3 will not include backwards compatibility with PlayStation 2 games, a decision expected to help keep the PlayStation 2 viable as a separate platform.

The console, which celebrated the seventh anniversary of its North American release in late October, has sold over 120 million units worldwide since launch. In an interview with MCV, Sony Computer Entertainment of America Vice President Peter Dille said, "PS2 is a perfect example of our ten year product life-cycle promise and is a testament to the design and technology that continues to be at the core of the product. We're very excited for its future."