Wedbush Morgan analyst Michael Pachter expects the Microsoft Xbox 360 to rally back after slow July sales and thinks that the Sony PlayStation 3 is due for another price drop early next year. He also says that the Nintendo Wii and DS will still be on top when the NPD results for August come in.

Pachter senses that the Xbox 360 sold about 240,000 units in August with the help of huge releases like Take-Two's BioShock and Madden NFL 08 from Electronic Arts. This, he thinks, is enough to edge the Sony PlayStation 2 which he predicts will hit the 225,000 mark.

The PlayStation 3, on the other hand, can be expected to have sold 150,000 units last month according to Pachter.

He expects sales to remain slow until the 80GB PS3 sheds US$ 100 off its tag later this year. He expects the 80GB PS3 to go as low as US$ 399 early next year as a prelude to big titles coming the platform's way. Pachter says:

We think that Sony's recent announcement of an IPO for its financial services unit (with an estimated $3 billion in proceeds) could forebode another PS3 price cut early next year. We believe that the company is interested in subsidizing sales of the console in order to stabilize its market share in the games market and grow its lead in the high-definition DVD market. We expect a price cut no later than April, likely to $399 for the 80Gb model.