Sony to discontinue lower capacity PlayStation 3

LOS ANGELES (Reuters) - Sony Computer Entertainment America said on Thursday it will discontinue its lower-capacity PlayStation 3 in North America, noting it has been outsold by the higher-capacity model.

The 60-gigabyte model, which has three times more storage capacity as the 20-gigabyte model, caters to gamers who also use the device to watch video and movies.

"This is based purely on consumer and retailer demand, which favored the 60-gigabyte model 10 to 1," said David Karraker, a spokesman for Sony, the world's top video game console maker.

He said there is a limited inventory of the 20-gigabyte units in stores. The retail price of those machines will remain at $500 until supplies are sold out.

Sony's (6758.T: Quote, Profile, Research, Stock Buzz)(SNE.N: Quote, Profile, Research, Stock Buzz) 60-gigabyte PlayStation 3 retails for $600 in the United States.

Thus far, sales of Playstation 3 have lagged rivals Microsoft Corp. (MSFT.O: Quote, Profile, Research, Stock Buzz) and Nintendo Co. Ltd. (7974.OS: Quote, Profile, Research, Stock Buzz)