Rather than simply dropping the price, Sony are also set to release the 80GB model of the Playstation 3 (previously released in Korea) and package it with a copy of Motorstorm for US$599. Which means that, technically, the price hasn't in fact changed (since the 20GB and 60GB models of the PS3 debuted at US$499 and US$599, respectively). Sony spokesperson, David Karraker, explained in the press release that the release of the higher capacity model was to facilitate Sony's plans to offer high-definition movies and games on the Playstation Network.
The price drop will begin Monday, with the 80GB model set to debut in the US and Canada in August. As always, there's been no word on any plans for a price reduction in PAL territories, but hopefully Sony's E3 conference will shed more light on the matter. Stay tuned.
UPDATE: Upon closer examination of the image of the new 80GB model on Sony of America's offical blog (viewable in the Media Panel below), the Home button on the controller appears to be red; perhaps denoting a different model of controller - possibly the new "Touch Sense" controller we've been hearing about?
SECOND UPDATE: According to GamesRadar, the red light is also found on debug PS3 controllers, and thus isn't necessarily new. And in response to a query from gaming blog, Joystiq, Senior Director of Corporate Communications, Dave Karraker, is quoted as saying "It is just a lighting trick. Nothing different or new about it."

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