As part of this week's 3D-crazy Consumer Electronics Show extravaganza, Sony is demonstrating several existing PlayStation 3 games in stereoscopic 3D.

Much like theaters and amusement parks, the pop-out 3D effect is made possible with the aide of these silly-looking glasses.

Demonstrated games with 3D effects include Evolution Studios' MotorStorm, Polyphony Digital's Gran Turismo 5 Prologue, and SCE Studio Liverpool's Wipeout HD.

After playing around with Wipeout HD, Ars Technica declared it was "one of the best demos of 3D technology we have ever seen." Meanwhile, Kotaku wrote that the effect was "surprisingly convincing" and "amazing, really."

Despite the praise, Sony was quiet regarding the specifics, claiming that "this is just a look at what 3D could look like if Sony decided to move in this direction"--a direction that was strongly hinted at last year by 3D advocacy group Meant to be Seen.

PlayStation 3 maker Sony has thrown the latest ball of mud in the console war, claiming that competitors Microsoft and Nintendo are merely "peddling add-ons" to keep up.

While Sony said that "the Xbox 360 and Wii offer a set of features in their own right," the company provided the above chart, stressing that "when you take a look at the feature offerings side by side, there is only one true winner in delivering total value and price."

The chart compares the lowest-priced offering from each manufacturer. Two other Xbox 360 models are available--the $299 60GB Pro, and the $399 120GB Elite--with a $499 PS3 packing a 160GB hard drive. Curiously, Sony did not discuss game lineups, which some consider to be a major factor in the purchase of a video game console.

With the holidays now behind them, the PlayStation 3 has sold roughly 20 million units worldwide since launch, while Microsoft says the Xbox 360 now tops 28 million. Before the holiday season kicked off, Nintendo's Wii had sold about 35 million units.

In its mailing to the press, Sony concluded:

The PS3 is the perfect example of a product featuring superior technology and a sophisticated design creating an ideal all-in-one... Read more

MotorStorm series developer Evolution Studios and Wipeout series developer SCE Studio Liverpool will someday share the same roof, owner Sony has revealed. The racing game studios are already "merged in terms of management structure and [are] using combined resources," Sony Worldwide Studios Europe senior VP Michael Denny informed GamesIndustry.

"Yes," he replied when asked if there was a plan to completely merge the two studios. "It was always the intention with them being in the same geographic location and working so closely together...but it's not happening overnight."

Denny added that Evolution will soon be "looking at future iterations of MotorStorm," while Liverpool is believed to be working on an entirely new Wipeout entry for PS3.

Following a holiday season at the bottom of the sales charts, and facing mounting losses throughout the company, Sony has reiterated its focus on turning the PlayStation 3 into a money-making machine.

"The most important thing for us as a company in the very short term is for us to start making money," said SCE Europe president David Reeves in a statement on the official PlayStation website. "Once we have alleviated that specific pressure, we can move forward at a rate of knots."

The PlayStation 3 sold less than half the units of the Xbox 360 in the key holiday sales month of November. Sony's console is the most expensive of its competitors, with its cheapest model selling for $399--double the price of the stripped-down Xbox 360 Arcade.

While Sony has previously denied rumors of a PlayStation 3 price cut in the near future, Microsoft's Aaron Greenberg says that his company expects a PS3 price reduction any day now.

"We absolutely expect the PS3 price drop to happen in the next couple of months," said Greenberg in an interview with Edge. "We're frankly surprised it's taken this long... I would expect they'd have to move on price, sooner than later, for sure."

The fact that PlayStation 3 sales in the United States dropped almost 19% in November 2008 over the previous year is no cause for concern, according to maker Sony.

That's because November 2007 was "an abnormally strong month due to a price cut [with] the introduction of the [$399] 40GB PS3," Sony told CNET News.

In fact, Sony says PS3 sales were up almost 40% in 2008, with early data suggesting the post-Black Friday holiday season brought about a sales increase of over 130%.

"2008 was a pivotal year for PlayStation with the best software line up in the industry [and] a dramatic expansion of PlayStation Network," said Sony Computer Entertainment America sales VP Ian Jackson, listing PlayStation Home and the PlayStation Store's video download platform as examples of the service's growth across the year.

Japanese electronics giant and PlayStation 3 maker Sony claims that it has no plans to announce another restructuring plan that would see the closure of multiple divisions.

The statement comes in response to a recent report by Times Online, which said Sony was "on brink of upheaval" and that employees were preparing for a "a series of 'sacred cow-slaying' measures" that would see major divisions and factories closed.

"We do not plan to announce additional restructuring measures at this time," Sony spokesman Atsuo Omagari informed Retuers. "We don't have any such plan."

In early December, the company said it was cutting 16,000 jobs, and would reduce focus "unprofitable or non-core businesses," as well as LCD and mobile phone technology. Following the announcement, many analysts said it was too little, too late.

Research and data collection firm The Nielsen Company has issued its list of the past year's most-played video game consoles, using data from the first 10 months of 2008.

According to Nielsen, the PlayStation 2 topped console usage, followed by the Xbox 360 and Wii. Meanwhile, the original Xbox was played more in 2008 than the PlayStation 3, which ranked as the fifth most-played console of the year.

Video Game Console Usage
1. PlayStation 2 - 31.7% Usage Minutes
2. Xbox 360 - 17.2% Usage Minutes
3. Wii - 13.4% Usage Minutes
4. Xbox - 9.7% Usage Minutes
5. PlayStation 3 - 7.3% Usage Minutes... Read more

The Wall Street Journal reports that a new book by IBM engineers has revealed some startling facts about the most recent console race.

"The Race for a New Game Machine," by IBM engineers David Shippy and Mickie Phipps, details how research conducted for Sony's Cell processor--used in the PlayStation 3--ended up directly benefiting the development of Micorosft's Xbox 360 chip.

The Journal summarizes:

All three of the original partners had agreed that IBM would eventually sell the Cell to other clients. But it does not seem to have occurred to Sony that IBM would sell key parts of the Cell before it was complete and to Sony's primary videogame-console competitor. The result was that Sony's R&D money was spent creating a component for Microsoft to use against it.

Mr. Shippy and Ms. Phipps detail the resulting absurdity: IBM employees hiding their work from Sony and Toshiba engineers in the cubicles next to them; the Xbox chip being tested a few floors above the Cell design teams. Mr. Shippy says that he felt "contaminated" as he sat down with the Microsoft engineers, helping them to sketch out their architectural requirements with lessons learned from his earlier work on Playstation.

The article notes that while both chip designs were shipped off to manufacturing on time, a problem with production caused Microsoft to receive its chips first, allowing Microsoft to beat Sony to the market with the Xbox 360.

Sony's PlayStation 3 hardware costs $391.62 less to manufacture now than when it launched in November 2006, according to estimates from research firm iSuppli.

iSuppli believes that a PlayStation 3 currently costs Sony $448.73 to produce. In mid-2007, it was at $690.23. At launch, it was $840.35 for the $599 60GB unit. It was not specified which PS3 model--the $399 80GB or the $499 160GB unit--was used in its most recent cost analysis, though the firm referenced the $399 price point.

Rumors have circulated that Sony may drop the PlayStation 3's price at the start of its next fiscal year in April 2009, with at least one analyst putting stock in those beliefs.

The 47% reduction in per-unit costs comes from lower component prices, as well as revisions that have reduced the amount of components by an estimated 30%. The firm claims that the first-generation PlayStation 3 had about 4,048 parts, while more modern PlayStation 3s only have around 2,820 components.

"The PS3 may be able to break even in 2009 with further hardware revisions," said iSuppli teardown principal analyst Andrew Rassweiler. The firm noted that its estimate "doesn't include other costs, including software, box contents and royalty expenses."

Thought Sony was quite clear that it would not cut the PlayStation 3's price in 2008, Webdush Morgan analyst Michael Pachter expects that stance to change in 2009.

Speaking with The Wall Street Journal, the respected analyst predicted that Sony will drop the PlayStation 3's price at the start of its next fiscal year, which kicks off in April.

At present, Sony sells two models of the PlayStation 3: a $399 80GB model, and a $499 unit that's bundled with a 160GB hard dive and a copy of Uncharted: Drake's Fortune.

Rival Microsoft slashed prices for its Xbox 360 hardware back in September, and the Xbox 360 has siginficantly outsold the PlayStation 3 in the United States since. The cheapest model, the hard drive-less Arcade sells for $199, while the 60GB Pro goes for $299 and the 120GB Elite edition carries a suggested retail price of $399.

The prediction coincides with earlier rumors that Sony would get "more competitive in price from March 2009 onwards." The rumors supposedly stemmed from an internal Sony briefing, and offered word on the first in-game God of War 3 and Uncharted 2 footage nearly a month before either trailer was released to the public.

"With [Sony CEO Howard] Stringer saying, 'We will be profitable,' you can't cut price [in this fiscal year]," explained Pachter. Sony had previously said that it would not drop the price as it "has a business to run" and has to "do the right thing" for shareholders.

Sony has once again denied the persistent rumors that it's preparing a follow-up to the PSP, with Sony hardware marketing director John Koller reiterating the company's claim that "no plans for a PSP 2 are underway."

Sony is moving away from the UMD disc format, Koller explained to Silicon Alley Insider, and instead encouraging developers to create downloadable PSP games.

He claims that this newfound push towards digital distribution was misinterpreted, leading to the recent rumors of PSP 2 games in development.

Since the portable system debuted, some have complained of the load times, which stem from the use of UMD optical media. While downloaded games may still have load times, the times are shortened due to the faster capabilities of memory sticks.

In response to Koller's statements, Eurogamer wrote that "our sources are adamant that Sony has specifically discussed both products [another PSP hardware revision and the PSP 2] with them, and that games are in development for a PSP successor."

Sony will release a new version of its PSP handheld next year, with the true successor to the hardware coming later, according to a Eurogamer report.

While release of the PSP follow-up seems a ways off, sources told Eurogamer that publishers are already working on games for the PSP 2.

The report runs contrary to Sony Computer Entertainment Europe president David Reeves' recent statement that Sony has "no plans for a PSP 2."

"I go to Tokyo quite a lot and no one has referred to it--I think they have their hands full at the moment," said Reeves. "We just launched the PSP-3000 so we are still focused on this generation of the platform."

Though rumors have persisted for years, Sony Computer Entertainment Europe president David Reeves has declared that "there are currently no plans for a PSP 2".

"I go to Tokyo quite a lot and no one has referred to it--I think they have their hands full at the moment," he told MCV. "We just launched the PSP-3000 so we are still focused on this generation of the platform."

Reeves added that software for the four-year-old portable has been its "weakness," though he vowed that "PSP games will come--they just take a while longer."

"That's because developers, when it comes to placing their bets, have to choose PS3 and 360, then Wii, then DS, maybe even PS2 before PSP," he explained." It's the same at our internal studios, where the focus has been on PS3. They've also focused a lot on PS2 as well because we have to get the SingStars out for that format."

Though it has not seen a flood of new releases, PSP hardware has been outselling both the PlayStation 2 and PlayStation 3 in the United States since August.

"Sudden and rapid changes in the global economic environment" have forced Sony to cut roughly 8,000 of its 160,000 jobs by April 2010, the company has revealed, with Reuters adding that 8,000 more will be cut from "more temporary and contract staff."

Sony Computer Entertainment--the Sony division responsible for PlayStation manufacturing and game development--will be involved in the forthcoming review.

"To stay competitive in the accelerating global network environment, we will always carefully review and make structural changes, if necessary, in order to further expand and strengthen the PlayStation business," SCE told GamesIndustry.biz.

The cost-cutting measures will also see Sony reduce investments in "unprofitable or non-core businesses" and reduce its focus on LCD and mobile phone technology.

A new 400GB optical disc could end up being compatible with existing Blu-ray players, such as Sony's PlayStation 3, creator Pioneer has informed online publication Edge.

While current Blu-ray players and drives will not be able to read the 16-layer disc--each layer can hold up to 25GB--Pioneer claims that a firmware update may allow existing players to be compatible. The technology is expected to hit mass market by 2010, with a 1TB version of the disc format expected to arrive within five years.

However, Pioneer further noted that the technology "is not being proposed as a candidate for addition to the existing Blu-ray Disc format" at this time.

Blu-ray discs currently max out in a 50GB design consisting of two 25GB data layers. Sony has yet to comment on the possibility of PS3 support for the new technology.

Illegal downloads of PSP software have slowed across the past two months, Sony Computer Entertainment America hardware manager John Koller has revealed.

Noting that piracy has been "a significant issue" for the platform, Koller told MTV Multiplayer that "it's trending down right now," adding that "we've seen the piracy not be as such prevalent in the last month to two months."

No explanation was offered as to the lowered piracy rate, nor as to how Sony calculated said rate. The past two months have been a relatively slow period for the PSP, with roughly 20 games released in the past eight weeks. The system often outsells the PS3 in the U.S., though its games rarely rank among the month's best-selling software.

Koller also commented on the "good vs. evil" battles that piracy inevitably raises.

"There's certainly people that are standing up and fighting for what we consider the good side, the rights of developers and publishers to make money on their IP," he observed. "And then there's certainly the other side that believes that they can take as warranted. It's kind of been nice to see other consumers going and help and fight the battle for us."

Sony Computer Entertainment Europe will be getting "more competitive in price from March 2009 onwards," according to a new rumor that apparently stems from an internal Sony Europe briefing.

Citing an anonymous source named Legends, D+Pad further noted that an unannounced sequel to Naughty Dog's PlayStation 3 game Uncharted was shown in trailer form, alongside Guerrilla's Killzone 2 and SCE Santa Monica's God of War 3.

The Uncharted 2 footage supposedly had an Aztec theme to it, with the source noting it "looks the same as Uncharted 1, no bad thing."

The report also claimed that the PS3 has a larger installed base in Europe than the Xbox 360, and stated that LittleBigPlanet and MotorStorm are coming to PSP.

While the report could be a collection of existing or obvious rumors, God of War creator David Jaffe has seemingly lent credence to at least one aspect. On his blog, Jaffe revealed that God of War 3 is in presentable form, as he saw it last week... Read more

Any PlayStation 3 game released after January 2009 will be required to have Trophy support, Sony Computer Entertainment has confirmed with VideoGamer.

"From Jan 09 all games must have trophies," Sony told the site.

Rewarding players with virtual recognition for their in-game achievements a la the Xbox 360's Achievements, the Trophy system made its debut in a July PS3 firmware update.

While certain games include native Trophy support or have been patched for compatibility, especially though published by Sony, many of this year's other holiday titles do not currently support the functionality.

Sony will be forced to pay $18.5 million in damages to a company called Agere Systems for a patent violation on a "wireless local area network apparatus" included in Sony handheld devices including the PSP.

The ruling, discovered by PSP Fanboy, ends a lawsuit filed two years ago by Agere. The firm is now a subsidiary of a company called LSI, "a leading provider of innovative silicon, systems and software technologies that enable products which seamlessly bring people, information and digital content together."

A jury ruled that the patent infringement was willful, which likely contributed to the total amount Sony is ordered pay.

Sony, like other large-scale game companies, was also recently hit with a patent claim for the PlayStation 3's Blu-Ray capability. In 2007, the company won a dismissal in a Blu-Ray-related suit and settled with Immersion, a force-feedback developer.

Update: Netflix has confirmed the loss of Xbox 360 owners' ability to stream movies from Columbia Pictures, a Sony subsidiary. Columbia's movies are not licensed to be streamed to 360 consoles.

"In the case of Xbox 360, a few hundred titles are temporarily unavailable to be streamed via the Xbox game console," wrote Netflix VP Steve Swasey to MTV Multiplayer. "We hope they'll be licensed for Xbox 360 shortly," he added.

Original Story: Those anxious to try out Netflix movie streaming in the New Xbox Experience have just hit a stumbling block: a preview user has reported that streaming movies from Sony subsidiary Columbia Pictures are not playable on the Xbox 360.

A Joystiq reader noticed that their Instant Queue--the web-based list required to watch Netflix movies on the 360--suddenly included a slew of titles... Read more