Sony has ruled out cutting the price of the PlayStation 3 console before Christmas, insisting that the PS3 is better value than rivals half its price.

(Maybe time to rethink that in today's -- or at least last week's -- economy?)

With up to 50% of video game sales made in the run-up to Christmas, Sony is gambling that despite the weak economy, consumers will not just buy the cheapest machine.

If they do, Sony could lose further ground to Nintendo's Wii and to Microsoft's entry-level Xbox 360, which sells for $199 in the U.S. after a price cut in September - half the $399 cost of the cheapest PS3.

Sony argues that the basic Xbox has no hard disk drive, while the PS3 plays High-Definition Blu-ray movies as standard. 

Sony launched its third PlayStation model in the line in November 2006. The PS3 competes most directly with the Xbox 360. Both are high-powered consoles that have sold well to gaming enthusiasts, but neither has matched the casual appeal and rapid success of the much cheaper Wii. 

More at the Financial Times.