The PS3 will come in two configurations: one version with a 60GB hard drive that will , SCE President Kaz Hirai said.
Those prices are significantly higher than Microsoft's Xbox 360, which has two versions, one with a 20GB hard drive that.
The announcement came on the eve of the Electronic Entertainment Expo (E3)--an annual gaming industry trade show taking place in Los Angeles this week.
In an interview with CNET News.com on Friday, SCE Executive Vice President and co-Chief Operating Officer Jack Tretton said, effectively, that the company believes consumers will pay whatever the next-generation console costs.
"People are going to perceive enough value" with the PS3, Tretton said, "that they're not going to consider the price to be a barrier to entry."
The PS3 is certainly a big technological leap over its best-selling PlayStation 2, which Sony said Monday had recently topped 103 million units sold.
The PS3, which is based on the Cell processor, will play CDs, DVDs and include a Blu-ray drive. It also includes built-in Bluetooth and Wi-Fi connectivity, as well as Ethernet compatibility. Further, it includes Dolby digital surround sound functionality and supports high-definition video up to 1080p.
The console also can run up to seven wireless controllers at once, and all PS3s will come with a built-in hard drive, either 60GB or 20GB.
Finally, it supports USB, Sony Memory Sticks, Secure Digital (SD) and CompactFlash.
In addition to announcing pricing, Sony also said the PS3 will hit store shelves in North America on Nov. 17, six days after its Japanese launch on Nov. 11.
Hirai noted that Sony is committed to shipping 4 million PS3s by Dec. 31 and another 2 million by March 31, 2007. That means--if customers are not put off by the console's high price--Sony could be in position to avoid the criticism Microsoft took for not being able to meet initial customer demand for the Xbox 360.
Meanwhile, Sony also showed off for the first time the PS3's controller--which looks much like that of the PS2, though it is silver rather than black.
How it differs substantially is that it includes technology that ties character movement on screen to that of players' hands. That is, as players move their hands around, the controller automatically senses the movement and translates it to character movement on screen.
That is a significant innovation that the Xbox 360 does not have. Nintendo, by contrast, has long said that the controller for its own, would have built-in motion-sensitive technology.
Tuesday morning, Nintendo hosts its own gala press conference in Hollywood. Microsoft's press conference follows immediately afterward, also in Hollywood.
It is expected that, among other things, Microsoft will formally announce development of "Halo 3," the follow-up to its best-selling "Halo 2." It is also thought that Microsoft will