They should drop it a whole lot more. I want to get a PS3, but dang Sony, $700 is a bit too steep for something that plays games... as a matter of fact, where's the killer apps?
They cant---They are already losing 150 bucks a unit before the 30 dollar discount. What they needs to do is publish a huge hit game in order to get market penetration.
The DS/Wii have been outselling nearly everything since their releases (the PSP temporally outsold the DS but it quickly slowed down while the DS has not).
Honestly, this REALLY surprised me. I really expected the PS3 to sell like crazy despite it's crazy price. Even though I like the wii better. :)