Sony drops cost of PSP handheld game device

Sony has cutthe price ofits PlayStation Portable in the face of stiff competition from rival Nintendo, the first such move since Sony launched the handheld video game and entertainment device in 2005.

The price onthe PSP Core packagehas dropped by $30, to$199.99 in Canada, Sony Computer Entertainment America Inc. said Tuesday. The core package includes the PSP hardware, an AC power adapter and a rechargeable battery.

"We have recently seen a steady rise in the number of teens adopting PSP as their primary handheld entertainment system, and we expect the new price will accelerate that trend," Jack Tretton, president and CEO ofSCEA, said in a written statement e-mailed to CBC News Online.

In 2006, Sony shipped 25 million PSPs globally and sold more than one million new PSPs in North America in December, the company said.

The PSP supports a range of media uses, including games, music, video, photos, web browsing, live and recorded TV through a special adapter, and wireless networking connectivity.

But Sony suffered a $443-million US operating loss in the third quarter on launch costs associated with its new PlayStation 3 video game console, declining sales of its previous PlayStation 2 machine, as well as slipping sales of PSP hardware and games, the company reported two months ago.

Nintendo Co. Ltd.'s DS dual-screen handheld game device, whichfeatures a touch-sensitive screen, retails for $149.99 in Canada.

Market research firm NPD Group Inc. reported that the DS outdid all other platforms in North America in February as 485,000 units were sold.

During the month, 335,000 units of Nintendo Wii, released in November,were sold, followed by 228,000 units ofMicrosoft's Xbox 360, and 127,000 units of Sony's PlayStation 3.