Sony to announce PS3 price drop?

Sony and electronics firm Nichia have unveiled a smaller, and cheaper, Blu-ray reader/writer module, sparking rumours the move will lead to a PlayStation 3 price reduction.

Currently, the most expensive component inside the PS3 is the built-in Blu-ray player, but the new device, which measures just 3mm high, is claimed to be far cheaper to produce than the unit featured in the PS3.

According to a Tech report, the new device is able to handle disks with organic dye in the recording layers, which can be turned out from existing DVD production lines.

Although Sony has denied an impending price cut, industry rumours suggest the firm could announce a cut later this year, with one leading analyst claiming: "Once the new Blu-ray module finds its way into the PS3 there's a real possibility of a price cut."