At a press event at the GamesCom convention in Germany today, Sony announced that the long-rumored slimmer PS3 will be released September 1 for $299, a $100 price drop from its current PlayStation 3. The console will have a 120 GB hard drive, be 33% smaller and 36% lighter, consuming 34% less power.

Sony needs to increase sales to compete. In the last 3 months, according to sales numbers from the NPD Group, Sony PS3 sold about 200,000 less units than Microsoft’s Xbox 360 and almost 500,000 less units than the Wii. Sales of both the PS2 and PSP have helped mitigate the differences, but it is hard to deny that Sony is losing this generation’s console war.

Read the full article at Fast Company.