While Sony refuses to cut the £425 asking price of its PlayStation 3 in the UK, it is offering a new PS3 Starter Pack in Europe from today.

The so-called "high value" Starter Pack consists of the PS3 console itself, two first party games and two Sixaxis wireless game controllers. This promotion adds a free Sixaxis pad and the two games to the original £425 system. Sony says the games offered in the Starter Pack will vary, but will include leading titles such as Resistance: Fall of Man and MotorStorm.

"The exceptional value of the new Starter Pack will bring the excitement of PlayStation gaming to a much wider audience," says the brief Sony release we received today.

"Add to this a stellar lineup of software titles for the second half of the year and we are confident that this amazing value Starter Pack will encourage many more keen gamers to join the PlayStation 3 community".

Many analysts believe that Sony needs to drop the price of the PS3 below £400 to make it a viable alternative to Microsoft's Xbox 360. This new Starter Pack might not go far enough.

Component costs for the Cell processor and the Blu-ray drive inside the PS3 are unlikely to fall significantly to make a price drop possible. Hence Sony is beefing up the value in those areas where costs are less of an issue - an extra wireless controller, an 80GB hard disk and free games.

Microsoft faces a similar pricing problem with its Xbox 360 console. It will be unable to cut the price of the 360 until the console's core components - specifically the IBM processor - can be manufactured cheaper. We expect such a drop to happen in the UK towards Christmas, once Microsoft has begun to roll out Xbox 360s that incorporate newer 65 nanometer processors.