PS3 slim and price cut rumors surface again

Chicago (IL) – The Playstation 3 slim rumor is one of those rumors that just won’t go away. New pictures and information provided by usual “industry sources” that a new PS3 form factor may be on track for a release this month, along with a long expected price cut. Both rumors seem very credible, especially since Sony has to cut the PS3’s price and since it can shrink the size of the PS3 box due to a much less power-hungry Cell BE processor.

As the PS3 nears its third birthday, we are still waiting for the console to deliver on its promise to become the dominating high-definition gaming device it once was promised to be. Often described as Sony’s fourth main business pillar, the PS3 is not only trailing Nintendo’s Wii, but also Microsoft’s Xbox 360 in terms of unit sales and it is clear that Sony needs to act.

It seems that the company has finalized a new PS3 form factor, which is currently manufactured by Foxconn and Pegatron and set for a July delivery date. There are plenty of pictures supporting this claim, although we would take the information that this revision will be the final design update for the PS3 with a grain of salt. From a technological point of view, however, a smaller PS3 form factor makes sense.

The original PS3 ran with a 90 nm Cell BE processor, which consumed an estimated 200 watts and required lots of space for cooling. With the arrival of the 40 GB PS3, Sony transitioned to a 65 nm processor with a rumored 135 watts power consumption. More than a year ago, IBM announced that it will be manufacturing a 45 nm version of the Cell BE, which is rumored to consume somewhere between 80 and 85 watts. If we believe industry rumors, then 32 nm versions of the processors are already available and are rated at a power consumption of 50 to 60 watts.

If Sony is introducing a new PS3 form factor, commonly referred to a PS3 slim, then we would assume that this new console will be enabled mainly by the 45 nm Cell BE processor, which requires much less cooling tricks than the original 90 nm chip.

Also likely is a price cut – which is not only necessary to allow the PS3 to better compete with the Xbox 360, but also possible because of lower component costs. The original PS3 design was estimated to have carried a bill of materials of close to $900, which was far higher than the retail prices of $499 and $599 for the 20 GB and 60 GB PS3s in late 2006. iSuppli reported in December 2008 that the bill of materials of the PS3 had shrunk to about $450 for the 80 GB model, which was much closer to the $399 retail price. It is reasonable to assume that Sony was able to further cut the bill f materials and make the design of the PS3 much more efficient since then.

Down the road, we would expect the current 160 GB flagship PS3 to take on a much more important role in retail to go head to head with the Xbox 360 Elite ($400) and enable Sony to reduce the price of the 80 GB version to compete with the 60 GB Xbox 360, which sells for $300.
If you are playing with the idea of buying a PS3, it may be a good idea to take these rumors seriously and wait a few more weeks to see how they shake out.