Sony would create a new $399 SKU by November. His prediction:
...you´re going to see the creation of a new, low-end SKU this holiday. It´ll likely remove integrated WiFi, memory card reader, and most controversially, all backward compatibility. (Remember, there´s still some back-compat hardware in even the new "software only" back compat SKUs; removing the remaining CPU is a significant cost savings.) You´ll see a new WiFi dongle made available. And finally, this low-end SKU will likely come with a smaller 40 GB hard drive. The low-end price will be set at $399, with the higher-end 80 GB SKU dropping to $499.
source: kotaku.com