Is PS3 Slim Enough To Rescue Sony's Gaming Legacy?

seems to be making all the right moves

Whether that'll be enough -- and in time -- to revive Sony's flagging video game fortunes and take on Xbox 360 and Wii will be another story, and the fact that it's up for debate means that Sony probably doesn't have the slam-dunk it needs.

With the holiday shopping season looming, Sony and its PS3 are fixing for a fight with longtime gaming rivals Microsoft and Nintendo, respective makers of those consoles. But given the declining numbers all video game makers are seeing this year, what about Sony's PS3 is going to set it apart when its competitors are almost certainly going slash prices themselves?

Sony finally confirmed the launch details Wednesday: a PS 3 Slim that will sport 120 GB of storage and retail for $299.99, and a $100 price drop for the 80-GB version of current PS 3, now $299. The PS3 Slim also makes use of a new version of the much-touted Cell microprocessor.

Sony also used Wednesday's press conference to debut PSP Minis -- smaller games that according to Sony make better use of the PSP's development capabilities -- plus a Digital Reader for the PSP. All of Sony's PSP ducks are in a row, it seems.

The main problem for Sony is that in recent years, it's been bested by both Microsoft, whose Xbox 360 consoles have a wider range of games, and Nintendo, whose Wii platforms continue to dominate.

Specific to the PS3, things went south for the console pretty fast following PS3's 2006 release -- not least because at the time, PS3 packages were going for as high as $600. The NPD Group puts the number of PS3 units sold in July 2009 at 122,000, less than half of the 252,000 Nintendo Wiis and also well below 203,000 Xbox 360s. It has to have been a tough pill for Sony to swallow, given that at one time, with the PS 2, Sony's consoles seemed like the only game in town.

Sony, Microsoft and Nintendo are also all fighting an uphill battle against a declining video game market in general. NPD's most recent figures, for July, show sales of both games and consoles down 29 percent year-over-year.

NPD Group also noted it expects price cuts on existing consoles to continue, meaning that as soon as prices come down on popular Microsoft and Nintendo consoles and games, it could be "game over" for Sony's PS3 yet again. As the season takes shape, Sony now needs to focus both on the price drop -- it's a great move, and has taken far too long -- and on those features that set PS3 apart from Wii and Xbox 360. Thanks to the Wii's hot WiiMote, motion-sensitive controller, and Microsoft's embrace of online content -- two areas Sony hasn't yet done well -- price alone may not be enough.