Sony Computer Entertainment Inc. announced the details of the reduced backwards compatibility of the PlayStation 3 game console to be sold in PAL regions. Apparently, the company will offer a different version of the console with lower production costs due to a removed chip, which combines graphics processor and microprocessor used in the PlayStation 2, for those countries.

“The Emotion Engine [and Graphics Synthesizer chip] has been removed and that function has been replaced with software,” said Nick Sharples, a spokesman for Sony Computer Entertainment Europe in London. That has a “slightly detrimental effect” on compatibility, he added in an interview with Digit Online web-site.

The original PlayStation 2 game console used so-called Emotion Engine (a 128-bit RISC processor working at 299MHz) with integrated RDRAM controller as central processing unit (CPU) as well as Graphics Synthesizer graphics processing unit. Later on the EE and GS were incorporated into a single chip, which is currently used in slim version of the PS2 and for backwards compatibility in the PS3 sold in Japan and the U.S. According to analysts, the EE+GS chip costs $27, whereas 32MB RDRAM is unlikely to cost more than $5. But despite of about $30 added cost amid higher prices of the PlayStation 3 for PAL regions, Sony’s shareholders reportedly insisted on removing the piece of silicon from the console, which is sold for at least $241 less than its manufacturing costs in the U.S.

“They’re using emulation software now to take the role of the hardware that was previously in the device. From a business perspective, it’s a way to move ahead removing costs in some regards to manufacturing. If you follow some of the high costs in research and development and also manufacturing we've incurred over the last while, it's a demand from some shareholders,” said SCE Australia spokesman Adrian Christie in an interview with The West Australian.

Sony claims that about 98% of old games can be played on the PlayStation 3 game console sold in Japan and the United States, however, backwards compatibility of the console will be much lower compared to that, according to the company. While competing Microsoft Xbox 360 game console also cannot play all of the games designed for Xbox, massively popular titles, such as Halo, are still available even with some additional eye-candy, e.g., at higher resolution and with antialiasing. The version of the PS3 sold in Japan and the U.S. also can upgrade PlayStation 2 games' graphics quality.

Potentially insufficient backwards compatibility may make gamers upset, as there are no really a lot of titles that take advantage of the PS3 and backwards compatibility is crucial. In fact, some gamers may put the PlayStation 3 purchase on hold, as getting a console with a few games that, perhaps, will not run several old titles, does not make much sense, especially in the PAL regions, where the machines will retail for up to $240 more than in the U.S. and up to $345 higher compared to recommended price (¥59 980 or $495) in Japan. Still, the company believes that end-users will jump on the PS3 bandwagon in anticipation of improved game titles made exclusively for the new console.

Initially Sony will only sell higher-end PlayStation 3 version of the console, with 60GB hard disk drive, for €599 ($777) in the most of the markets and for pricing close to that in variety of countries (UK – £425 ($837), Ireland – €629 ($816), Australia – AUD 999.95 ($777), New Zealand – NZ 1199.95 ($840)).

Sony PlayStation 3 console is based on the Cell processor developed by IBM, Sony and Toshiba, the RSX graphics chip by Nvidia Corp. and will be equipped with Blu-ray optical disk drive. There are two versions of the PlayStation console available in the USA and Japan: one is equipped with 20GB hard disk drive and priced at $499, another features 60GB hard drive, card reader and some other improvements and is offered for $599.