Richard Doherty, an analyst at the research company Envisioneering Group in New York has concluded that a alot of sales that would have gone to the Xbox Elite will now go to the PS3 following the arrival of its newly announced price cut. Although well known analyst Michael Pathcer warned that a price of $500 is not going to get anyone excited, but the price cut is a good signal all the same.

The price cut is unlikely to help the company dramatically expand its market share,'' Seiichiro Iwamoto, who helps oversee the equivalent of $809 million at Mizuho Asset Management Co. in Tokyo. ``There is still a large price gap.''

U.S. consumers have purchased 1.38 million PlayStation 3s since it was introduced in November. That compares with 2.84 million Wii players, which reached stores the same month. Microsoft sold 5.5 million units of the Xbox 360, introduced a year earlier, according to New York-based NPD Group Inc., which tracks sales.

"A lot of sales that would have gone to the Xbox Elite will go to PlayStation'' after the price cut, Richard Doherty, an analyst at the research firm Envisioneering Group in Seaford, New York.