The new, slimmer PS3 model displayed at a news conference in Tokyo, Japan (Photo: AP)

After months of rumors and anticipation, Sony announced this week that they were slashing the price of its PS3 console by $100 to $299 to help boost their sales in time of the holidays.

The 80GB model of the PS3 is currently available at the reduced price. The company also revealed the launch of a slimmer, lighter model PS3 with a 120GB hard drive to hit stores in early September. It too will cost just $299.

The price of the existing 160GB PS3 was also cut by $100, to $399.

The price cut follows a July report that the PS3 was being outsold by rival consoles such as the XBOX 360 and the Nintendo Wii by over 100,000 units.

When the PS3 launched, it cost as much as $600, but sales have fallen since then.

Sony president, Jack Tretton, told the Associated Press that customers "absolutely believe that it's the technologically superior device. (They) absolutely want one but have had trouble justifying the price."

Year-to-date, overall sales are down 14 percent in the U.S., according to the NPD Group.