From Reuters: "The new version of the PS3 will come with a 40-gigabyte hard drive, cost $400, and go on sale on November 2, said Jack Tretton, president of Sony Computer Entertainment America. The price of the 80-gigabyte version will be cut to $500 from $600."

The 40 GB PS3 will drop backward compatibility, 2 USB ports and memory card slots. As Tretton stated, "Backward compatibility is a nice secondary consideration, but it's far from the number-one priority."

Included in the Playstation 3 40GB model is the Spider-man 3 Blu-ray disc. Read the specs and the full press release from Sony Computer Entertainment America (SCEA) below (here). The 80 GB goes to $499, effective immediately.

Sony Computer Entertainment America Announces New 40GB Playstation 3
(PS3(TM)) Configuration and Price Reduction Of Current 80GB Model

New 40GB Model to be Available in North America on November 2nd for $399;
Effective Immediately, 80GB PS3 to be Priced at $499

FOSTER CITY, Calif., Oct. 18 — Sony Computer
Entertainment America Inc. (SCEA) today announced plans to introduce a new
40GB model of its PLAYSTATION(R)3 (PS3(TM)) computer entertainment system.
Beginning November 2nd, to further enhance the HD entertainment experience,
the new 40GB PS3 model will come bundled with the blockbuster movie
Spider-Man(TM) 3 Blu-ray Disc(TM) (BD) from Sony Pictures Home Entertainment,
and will be available in North America for a suggested retail price of $399
(USD/CND). The company also announced that effective immediately, the current
80GB PS3 model will be available in North America for $499 (USD/CND), $100
below the original launch price.

“We’re pleased to offer the consumer a lower price point without
sacrificing the core technology components that make PS3 the most advanced
high-definition entertainment system available. Every PS3 comes with a
Blu-ray drive, HDMI output, an integrated Wi-Fi connection, Cell Broadband
Engine and a built-in hard-drive,” said Jack Tretton, President and CEO, SCEA.

“This holiday season we’ll be able to offer attractive retail pricing with a
broad portfolio of outstanding games including Ratchet & Clank(R) Future:
Tools of Destruction(TM), THE EYE OF JUDGMENT(TM), Uncharted: Drake’s
Fortune(TM), Heavenly Sword(TM), Call of Duty(R) 4: Modern Warfare, Assassin’s
Creed(TM), Haze(TM) and RockBand(TM).”

The new 40GB PS3 will no longer play PlayStation(R)2 titles, reflecting
the availability of a more extensive line-up of PS3 specific titles.
Consumers looking for backwards compatibility can take advantage of the
limited PlayStation 2 backwards compatibility of the 80GB PS3.

PLAYSTATION(R)3 40GB Specification

Product name PLAYSTATION(R)3
CPU Cell Broadband Engine(TM) (Cell/B.E.)
GPU RSX(TM)
Sound Dolby 5.1ch, DTS 5.1ch , LPCM 7.1ch, AAC,
others *1 *2
Memory 256MB XDR Main RAM, 256MB GDDR3 VRAM
HDD 2.5? Serial ATA 40GB
I/O USB 2.0 x2
Communication Ethernet X1 (10BASE-T, 100BASE-TX, 1000BASE-T)
IEEE 802.11 b/g Included
Bluetooth 2.0 Included
(EDR)
Wireless controller (Bluetooth) Included
AV Output Screen size 480i, 480p, 720p, 1080i, 1080p
HDMI OUT x1 *3
AV MULTI OUT x1
DIGITAL OUT x1
(OPTICAL)
BD/DVD/CD Maximum Read Speed BD 2x (BD-ROM)
Drive DVD 8x (DVD-ROM)
(Read Only) CD 24x (CD-ROM)
Dimensions Approximately 12.75in(W) x 3.86in (H) x
10.8in (D)
Weight Approximately 11 lbs
*1 A device compatible with Linear PCM 7.1 Ch. is required to output 7.1
Ch. audio, supported by Dolby TrueHD or a similar format, from the HDMI
OUT connector.
*2 This system does not support output from the DTS-HD 7.1 Ch. DTS-HD 7.1
Ch. audio is output from a 5.1 or lower channel.
*3 “Deep Color” and “x.v.Color (xvYCC)” defined by HDMI ver1.3a are
supported.

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