It has long been the hallowed Sony marketing statement to justify the price of the PlayStation 3: it is the cheapest Blu-ray player on the market. That's no longer true however and who is Sony to blame... Sony!
It's second generation BDP-S300 was always good value at $599 but now Sony has lopped a tonne off it in the run up to Fathers' Day (seems sons get good pocket money in the US).
Consequently, at $499 the player now officially bests the 60GB, $550 to $599.99 (depending where you look) 60 GB PS3 (the 20GBer having been culled). The smarts of such a move have to be questioned however since while Sony cannot afford to fall any further behind HD DVD in the pricing war, the 'cheapest Blu-ray player on the market' label certainly helped bulk up the PS3's sales.
Interestingly, Sony's official explanation is that demand for Blu-ray products has increased (as production costs have reduced) but it could be argued – for once – that such a cut was not in the company's best long-term interests.
Either way, the situation is suddenly that Blu-ray movie buffs on a budget no longer need to buy a PS3. What difference that makes to the console as a whole remains to be seen... though as a Brit I'd just be happy to watch Sony release a Blu-ray player over here that wasn't 12 months old and cost nearly a grand...