Sony intros $399 PS3, sells chipmaking to Toshiba

Sony today confirmed the US release of the 40GB PlayStation 3, the lowest-cost version of the console to date. Like the European version announced earlier, prices are reduced both through the reduced storage as well as half the USB ports and the removal of the multi-format card reader. Backwards compatibility with the PS2 has also been scrapped, Sony says. Wi-Fi remains from high-end PS3 models. The 40GB edition will be available in the US on November 2nd for $399 and will be accompanied by a price drop on the 80GB model to $499.

Significantly, the release did not include mention of the Dual Shock 3, which is launching in Japan as an optional controller and restores rumble feedback to the gamepad in the wake of the Immersion patent agreement.

Simultaneous with the introduction is the announcement of a joint venture between Sony and Toshiba to help manage production of the hardware inside the PS3, including the Cell processor as well as the NVIDIA-designed RSX graphics chipset. The shift will have Toshiba pick up production of the 300mm chip wafers and increase its semiconductor business through the increased orders; Sony will in turn have more of an opportunity to focus on researching the manufacture of smaller CPUs that should run cooler and drive console prices down. A partnership with IBM to develop the next iteration of the Cell was also underway, Sony said. The transfer of Sony's chipmaking to Toshiba should be completed by March 2008.