PS3 Slim Rumors Mount As Manufacturing Contracts Reported

New media reports claim that Sony has signed manufacturing contracts with two Taiwanese firms to build a long-rumored, slimmed-down edition of the PlayStation 3 hardware.

According to website UDN (as translated by consumer weblog Joystiq), companies Foxconn and Pegatron have been contracted to start shipping new units as soon as early July "to cope with expected summer vacation demands."

Rumors of a smaller, leaner PS3 began to build ahead of E3, fueled by a series of grainy photographs that first appeared on Chinese message boards and were quickly discovered by blogs like Kotaku.

Despite suspicion that Sony might reveal a hardware redesign at E3, no such announcement was made and the company has repeatedly declined to comment on the speculation.

As the crucial Christmas season approaches, the company has come under increasing pressure from public comments made by analysts, retailers like GameStop and publishers alike to lower the PS3's $399 price in order to drive sales, broaden its install base and benefit developers on the platform.

Rival Microsoft made strides in boosting its install base with the launch of an alternative Xbox 360 SKU that was priced lower and lacked a hard drive, demonstrating that offering consumers hardware options at different pricing and capability tiers can support console sales.

Notably, all previous generations of PlayStation hardware, including the PSP, have received slimmed-down editions post-launch -- the PlayStation 2 has been updated more than once, first to slim its size and later to reduce its weight, so that the most current model is significantly smaller and lighter than the launch hardware.