A high-ranking executive from Sony Computer Entertainment Europe denied in an interview a price-cut on PlayStation 3 game console in the short- and mid-terms citing necessities to demonstrate profitability of the video game console maker. As a result, the console will remain the most expensive on the market amid global economic crisis and reduction of spending.

“I think it will [remain the most expensive console on the market]. I'm not saying there are going to be any price cuts at all in the short term or the medium term. I'm not saying we don't need to do it - we are expensive. It is possible that as the cost [of manufacturing] comes down, we will be able to do it,” said David Reeves, president of Sony Computer Entertainment Europe, in an interview with Eurogamer web-site.

Earlier this year an analyst said that after generally slow first quarter Sony Computer Entertainment Inc. will reduce the price of the entry-level PS3 to $299, which is just $50 higher than the price of Nintendo Wii and is inline with the cost of Microsoft Xbox 360 60GB console.

The price-cut should boost popularity of the PS3, which retails for $399 today, among consumers who are cutting down their spending because of gloomy economic outlook. However, considering the fact that each PS3 video game machine still costs $448 to build despite of the official price tag of $399, the manufacturer is losing money on every unit sold and Sony claims it needs to secure itself from further losses.

“We're protecting ourselves with a very hard shell to get through the next one or two years of an economic situation. If you're experienced, you know you have to go into that mode - it's like being an armadillo. You have to be hard, and then you will come out when the sun comes out,” said Mr. Reeves.

Tags: Sony, Playstation