PlayStation 4
Sony announced price cut for its PS4 consoles in Japan.Instagram

Speculations are rife over the possibility of a price cut for Sony's PlayStation 4 (PS4) console worldwide following the company's announcement to slash prices in Japan.

Sony made the price reduction announcement at the ongoing Tokyo Game Show (TGS) in a press conference.

PS4 in Japan was costing 39,980 yen, but following the price drop, it now costs 34,980 yen, which according to Attack of the Fanboy, would be about $42. The price reduction will be effective from 1 October, 2015.

It is widely believed that Sony might not be willing to cut its prices elsewhere. It cited example of Sony's response last year when Microsoft dropped Kinect from being a compulsory to an add-on and later lowered its price to $349. Sony's only reaction was to give free video games, The Last of Us Remastered or Destiny: The Taken King.

Ars Technica argued that according to its analysis, on an average, most of the gaming consoles drop their prices a little below 80% of the original price, two years after release. But there are very few consoles that follow that path. It must be noted that only those consoles that are struggling to stay at the top make price cuts, not the ones that are successful.

The report adds that Japan is a different market in comparison to the West. It further argues that the competition for Sony is not Xbox One or Wii U but PS3.

This might be an attempt by Sony to push its PS4 console further. So, Sony might only drop price if its consoles become less popular in the West.