An executive of Sega Sammy Holdings" game unit said Sony will likely need to substantially cut the prices of its game console PlayStation 3 by the end of the year to stir up slow demand.

Nintendo Co. Ltd."s Wii outsold the PS3 by a ratio of over six to one in June in Japan, according to game magazine publisher Enterbrain, solidifying its leading position.

"Name brand, price and software are what count," Sega Corp. corporate director Masanao Maeda told Reuters in an interview on Monday.

"Since it"s getting difficult to make software availability a differentiating factor, superior marketing and pricing strategy will be the key for Sony."