"Dave Karraker of Sony America states, "At launch, we offered two separate models of PlayStation 3 to meet the diverse needs and interests of our PlayStation fan base. Initial retail demand in North America was upwards of ninety percent in favor of the 60GB SKU, so we manufactured and shipped-in accordingly. Due to the overwhelming demand for the 60GB model from both retailers and consumers, we have ceased offering the 20GB model here in North America. In addition to the larger internal hard drive, the 60GB PlayStation 3 features added storage media slots and built-in Wi-Fi not found in the 20GB system. Based on retailer and consumer feedback, we have decided to focus our current efforts on the more popular 60GB model."
My take is that Sony, along with the rest of the world had no idea that the Nintendo Wii would overtake it as the most popular next generation gaming console. Having 2 kick @$$ consoles would have lead Sony to higher market shares (selling 2 consoles opposed to 1 like Ninetndo and Microsoft), but that's not how it panned out. Killing off the 20GB PS3 will cut manufacturing costs, but still put more money in Sony's pockets forcing people to buy the $600 gaming/entertainment console.
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