A week after shaving $100 off price of $499 model of PS3, Sony says it will discontinue console.

    Sony plans to phase out the cut-priced $499 model of its PlayStation 3 video game machine, leaving only a higher capacity $599 model for sale in the United States, the company said Monday.

    The revelation undid some of the praise Sony won from the gaming industry last week for its 17 percent price cut on the machine, a move seen as leveling the playing field with Microsoft's Xbox 360 console.

    But one analyst said Sony had left the door open to further price cuts, saying another would almost certainly happen when the cheaper PlayStation 3 sells out.

    Sony dropped the price on the PS3, which comes with a 60-gigabyte hard drive and high-definition Blu-ray DVD player, by $100 last week in a bid to boost sales of the console by passing on lower costs to consumers.

    It also said it would launch a new model featuring a hard drive with 33 percent more capacity—80 gigabytes—and a copy of its off-road racing game "MotorStorm" in August.

    A company spokesman said Sony would sell the $500 version until "supplies of that unit are depleted," estimated to be months after the August debut of the new, pricier model.

    "We have ample inventory to meet the immediate needs of consumers in this territory for several months to come," Dave Karraker said in an e-mailed response to questions.

    "We won't be making any further announcements regarding our PS3 model hardware strategy in North America until the 60GB model is exhausted and market conditions are evaluated," Karraker said.

    The statemen tconfirmed remarks by David Reeves, president of Sony Computer Entertainment Europe, carried last week on gaming news Web site GamesIndustry.biz saying the 60-gigabyte model would be discontinued.