Sony's PlayStation 3 will cost gamers £425 at its launch on 17 November, roughly £18 more than it will cost elsewhere in Europe. 

The version of the console that comes with a 60GB hard drive will cost €599 in Europe, which works out as £407 under the current conversion rate.

However, with no UK price mentioned for the 20GB version of the console, which will cost €499 (£339) in Europe, it is feared that Sony will not offer the lower-spec machine in the UK.

Ray Maguire, Sony's UK managing director, defended the price as "a bargain" when Blu-ray DVD players could retail for £600-£700.

The PlayStation 3 will face tough competition from Microsoft's Xbox 360 in the Christmas buying period.

Microsoft will package its next-generation console with a bundled HD-DVD drive for less than the price of the PlayStation 3.

Maguire admitted that Sony has a big challenge ahead. "The point is that most people don't realise what they're actually getting with a PlayStation 3," he told Eurogamer.tv. 

"It's a games machine and we all know that, but it's also a high-definition video playback device through Blu-ray, and a lot of people don't really understand that part of the functionality."