"The PS3 is a lot more difficult to cost reduce.  There's a heck of a lot more under the hood and it costs us more money to make it," Tretton said.  He went on to mention that consumers that purchase a PS3 for US$599 see the value in their new buy and “in some instances they're willing to pay ridiculous prices to buy one on eBay,".
Meanwhile kotuku.com is reporting that the supply is outstripping demand for the PS3 in Japan with retailers taking it on themselves to shift product.  Especially the 20GB non-Wi-Fi enabled version of the PS3, some retailers removing 10,000 yen (US$82) from the retail price.

It would seem the 20GB version of the console is out of favour generally, as we may not initially see this version in the European and Australian Market when the launch occurs in March.{moscomment}