Sony could announce a US price cut for the 80GB PlayStation 3 (PS3) at the Tokyo Game Show later this month, according to analysts.

The console maker is set to drop the price of the 80GB PS3 to $499 once retail supply of the discontinued 60GB model depletes, they claim.

"We note that Sony recently acknowledged that it will no longer produce its 60GB PS3, and we expect the price of the 80GB PS3 to be reduced to $499 before the holidays," said analyst Micheal Pachter after it was revealed that Sony's internal supply of 60GB had run dry.

Analyst Jesse Divnich agrees.

"To remain competitive against the other consoles, the Sony PS3 would have to reduce its 80GB SKU by $100 down to $499. Other options, besides a price drop, could be the bundling of more free software titles, which has always been a popular option during the holiday season," he said.

In addition to the anticipated 80GB price reduction, Pachter remarked that a second PS3 price cut could come as early as next year. The move may be needed to better compete with Microsoft's Xbox 360 which is expected to outsell the PS3 by a factor of 2 to 1 during the holiday season.

"We are confident that through the coming months, Sony will make the correct decisions to prevent the gap between the PS3 and the Xbox 360 to widen," Divnich optimistically added.

If a price cut is in the cards for the PS3, a likely time to announce a concession would be at the Tokyo Game Show later this month.

See also:

Xbox 360 Elite review

PS3 review

Nintendo Wii review