Sony on Monday put a price tag on its PlayStation 3 (PS3) that makes its top-of-the-range model $200, or €200, more expensive than Microsoft’s premium Xbox 360, creating a wide price gap as the two struggle for leadership in the next generation of games consoles.

The Japanese company also unveiled a new games controller for the PS3 designed to open up a bigger technological lead over Microsoft, though it will have lost nearly a year to its arch-rival by the time the machines finally arrive on store shelves in November.

Speaking at the annual E3 games show in Los Angeles, Kaz Hirai, head of Sony Computer Entertainment America, said that the long-awaited PS3 would go on sale in Japan on November 11, more than six-and-a-half years after the PS2 made its debut, with US and European sales set to begin on November 17.

Like Microsoft, Sony said it would sell two different models of the console: a machine with a 20GB hard drive that will cost $499 and a 60GB version that will sell for $599. In Japan, the 20GB model will go on sale for Y58,000, while retailers will initially be allowed to set their own price for the 60GB version.

Microsoft, which stole a march on Sony by getting the Xbox 360 to stores last November, sells a base model for $299 and a premium version that includes a 20GB hard drive for $399.

Justifying the decision to put a hard drive in every machine, as well as a player for Sony’s own Blu-ray DVD format, Mr Hirai said that the expensive technology was essential to high-definition video, which Sony hopes will help sell the machines.

While Microsoft raced to get its machine to the market first, Sony has bet on the PS3 achieving a clear technological leadership over Xbox 360, preferring to wait longer to achieve its goal of gaining a clear technological edge.

However, even the higher prices for the PS3 will still leave Sony nursing heavy losses from its consoles, at least in the early days of production. According to an estimate by Merrill Lynch analysts, each PS3 will initially cost $900 to build, though the cost will fall to around $320 after three years as production volumes rise and the cost of parts declines. Microsoft, by contrast, is estimated to lose more than $100 on each Xbox 360.

Adding to Sony’s claims of technological leadership, Ken Kutaragi, head of the PlayStation division, showed off a new wireless game controller that will come with every PS3. Using the new controller, players will be able to interact with a game simply by moving the handset around. For instance, a player can make an aircraft in a game roll to the right by tilting the handset in that direction.

While Microsoft faced considerable cost and logistical difficulties satisfying initial demand for the Xbox 360 during the last holiday season, Sony said it would have 2m machines on sale at launch, with another 2m due to hit the market before the end of this year. By the end of its financial year next March, some 6m PS3s would have been shipped, it said. Microsoft, by contrast, has set a goal of up to 5.5m Xbox 360s by the end of June this year.

Sony also unveiled many of the new games for the PS3, as well as a free online service for its games users designed to catch up with the more advanced internet service available on the Xbox 360. Calling the new online service “an environment that is more than a place to play games,” Mr Hirai compared the service to MySpace and other popular online social networking sites.

Among the games that will go on display at the E3 show, Sony showed off a high-definition version of Gran Turismo, which has been one of the most successful game franchises on earlier PlayStations. The game will go on sale soon after the launch of the console, compared with the 18 month wait before the version for the PS2 appeared, the company said.

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