Wedbush Morgan analyst Michael Pachter has issued a broadside at Sony saying that the company is a "distant third" in the console price and that price is killing the PlayStation 3.
"Sony has historically priced at its production cost (or above), but it has historically been in first place," he told CVG.
"This generation, the company is a distant third, and is falling behind at a rapid pace."
"Keeping the PS3 price high kills Sony, and gives Microsoft a huge competitive advantage," he went on. "In my view, every Xbox 360 sold is a lost opportunity for Sony to sell a PS3, and Microsoft has no intention of taking a sabbatical.
"Lowering the price will cost Sony a lot, but it should generate sufficient future profits from game and Blu-ray movie sales and royalties to offset those losses," concluded Pachter.
Sony announced yesterday cuts were to be made to its "Gaming Segment" as the firm looks to save ¥250 billion this year.
By Mike Bowden