Just when I thought that I was out, they pull me back in.

--Michael Corleone, "The Godfather: Part III"

What is it with Microsoft employees and their zeal for wagering with the staff of Level Up? After Sony's gang-who-couldn't-shoot-straight handling of its talking points surrounding the price cut for Playstation 3 in the North American market, and the introduction of a PS3 value pack in Europe, a friend--Xbox director of technical strategy and attack blogger Andre "Ozymandias" Vrignaud ("the Sean Hannity of the Xbox division's blog army," as we affectionately dubbed him last year)--tapped out this post and emailed us the link. In it, he wrote:

The old 60 GB SKU is being cleared out for $499 as quickly as possible - as you might recall, this was the supposed "price cut" that Sony announced. In reality, once supplies are gone in the next couple of months it'll be gone forever. However, that doesn't leave Sony in a good place. A single, $599 SKU would be untenable; if they don't move significant hardware this holiday they'll basically be dead for this generation.

My prediction is that you're going to see the creation of a new, low-end SKU this holiday. It'll likely remove integrated WiFi, memory card reader, and most controversially, all backward compatibility. (Remember, there's still some back-compat hardware in even the new "software only" back compat SKUs; removing the remaining CPU is a significant cost savings.) You'll see a new WiFi dongle made available. And finally, this low-end SKU will likely come with a smaller 40 GB hard drive. The low-end price will be set at $399, with the higher-end 80 GB SKU dropping to $499.

So there you go - nothing magic about the current value SKU. It's just a classic retail technique of clearing the channel for new SKUs. Now we just need to wait a few months for the announcement - it'll have to be before Thanksgiving, so I'd expect October. 

We pinged him back with our prediction for the remainder of 2007 after store shelves had been cleared of the 60 gigabyte PS3: one SKU, $499. Not long thereafter, Vrignaud placed a call to Level Up HQ, challenging us to a wager on the subject of Sony's pricing plans for this holiday. We initially demurred, but Vrignaud persisted, and we acquiesced; this time, we won't even be able to blame intoxicants, seeing as we accepted during business hours.

The bet is as follows: Vrignaud says that Sony will start selling a $399 PS3 by Black Friday 2007, the official start of the holiday season. We say no. Vrignaud expressed interest in our dreads--no doubt hoping to bestow them upon a particular colleague as a token of his devotion to the Xbox cause--but we declined, preferring to keep our flowing locks safely out of harm's way. Instead, we agreed that the loser would buy the winner a steak dinner at a restaurant of the winner's choosing. We're partial to Gotham steakhouse in our hometown of Vancouver, Canada; it's pricey, but their steaks are the best we've ever had, bar none. And with Microsoft about to unleash the "Greatest Holiday Lineup in Videogame History," Vrignaud should have absolutely no trouble picking up the tab.