The speculation would be in line with the company's previous statements, as Sony CFO Nobuyuki Oneda said in a conference call earlier this year that both the Cell processor and the RSX graphics chip would be pared down to 65nm, with the Cell's transition coming first. Oneda wouldn't specify the timeframe, only saying it would come "during the peak production time," and serve as the first step in eliminating the company's negative margin.

Sony's losses from its PlayStation branch have been increasing, doubling during the last quarter, so it also makes sense that the introduction of a cheaper model would be paired with cheaper production costs related to the inclusion of a 65nm processor.

Shacknews contacted Sony for comment, but has not yet received a response.