Sony Computer Entertainment America said on Thursday it will discontinue its lower-capacity PlayStation 3 in North America, noting it has been outsold by the higher-capacity model.

The 60-gigabyte model, which has three times more storage capacity as the 20-gigabyte model, caters to gamers who also use the device to watch video and movies.

"This is based purely on consumer and retailer demand, which favored the 60-gigabyte model 10 to 1," said David Karraker, a spokesman for Sony, the world's top video game console maker.

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He said there is a limited inventory of the 20-gigabyte units in stores. The retail price of those machines will remain at $500 until supplies are sold out.

Sony's (SNE) 60-gigabyte PlayStation 3 retails for $600 in the United States.

Thus far, sales of Playstation 3 have lagged rivals Microsoft Corp. (MSFT) and Nintendo Co. Ltd.