Sony Announce PS3 Slim and Price Cut, Blu to Benefit?

Yesterday, following much speculation, Sony unveiled their slim version of the PlayStation 3 console at GamesCon.  The new unit is smaller and lighter than its predecessor, has less power consumption resulting in less fan noise, gains a 120GB hard drive and BRAVIA TV Sync, but does lose the ability to run PS2 games and the option to install a Linux OS.  The PS3 Slim will be on sale in the US for $299, Europe for €299 and the UK for £249, from the 1st of September in the US/Europe and the 4th in the UK.

Sony have also officially lowered the price of the original PS3 to $299, obviously with the intention of clearing the remaining models, however we don't see this happening unless it's discounted further instore or there are enough people out there who want Linux or PS2 compatibility. 

The PlayStation 3 is already the most popular Blu-ray player in the world in terms of numbers sold, and this price drop brings it into line with most other premium-branded players again.  As is usual with a price cut, sales will increase, meaning more Blu-ray players in homes, but will this have an effect on the prices of discs, which are still considerably more expensive than their DVD counterparts, especially in the rental market?

So, who's going to take the plunge now the price has come down and the unit has become more petite?  At this price point, is there any other viable alternative, value-for-money wise?  Let us know in the comments!