Wedbush Morgan Securities analyst Michael Pachter has predicted that the PlayStation 3 will sell out in Europe by May, with a price cut of more than EUR 150 expected inside 12 months.
"I'm actually surprised that consoles are not priced more like other consumer electronics, with early movers charged a bunch and the mass market charged less," Pachter told GamesIndustry.biz - using the example of DVD players, which are now available for much lower prices than when they first launched.
He went on to dismiss suggestions that the high cost of Sony's new console might affect sales, stating, "The PS3 can command GBP 425 from the hardcore and I think you'll see price cuts a year from now, probably to GBP 300."
According to Pachter, the UK's stock allocation will "quickly disappear" after PS3 goes on sale come March 23, and the console will "sell out relatively soon after launch" in the rest of Europe.
"There will be a few more games by then, with several great games announced for release in May and beyond, so I expect a full sellout by the end of April," he said.
By the time the PS3 launches the Xbox 360 will have been available in Europe for over a year, while the Wii was a sell-out success when it launched in December. However, Pachter said he doesn't believe this will necessarily cause big problems for Sony.
"March is not too late, given Sony's production problems and only 800,000 Wiis sold in Europe last quarter," he stated.
"My guess is that the Wii will be up to near 1.6 - 2 million by March 23, but that is far from an insurmountable head start."
Pachter described the PS3's graphics as "phenomenal", adding that the cost of hooking the machine up to a 1080p monitor is "worth every penny".
"I think that games like Gears of War on the 360 look every bit as good, but given that PS3 game development was rushed, I fully expect next year's games to look better on the PS3," Pachter concluded.