Reuters is reporting that Sony will launch the 40GB PlayStation 3 in the United States, and will cut the price of the 80GB model by 17%, to $500 from $600.

The new 40GB version will cost $400, and go on sale on November 2, reports the news agency, quoting Jack Tretton, president of Sony Computer Entertainment America.

"I think the educational curve is starting to be broached with the general consumer", Tretton told Reuters in an interview, when asked about his expectations for the PS3.

The 40GB version in the States will be the same as the model in the UK, with no backwards compatibility.

"We're choosing to focus on the PlayStation 2 consumer with the PlayStation 2, which remains incredibly relevant, and focus on the PlayStation 3 consumer with the new 40-gigabyte model and the great software coming out", Tretton said.

"Backward compatibility is a nice secondary consideration, but it's far from the number-one priority."