The Bookseller are reporting that WHSmith have followed Waterstone's in cutting the price of the Sony Pocket Edition to £99. Everyone agrees that both price changes were caused by Amazon's announcement that they will sell K3 in the UK for £109.
I'm a little disappointed, but perhaps I'm expecting too much too soon. In the US price war a couple months passed between the Kobo announcement and the Nook Wifi announcement. Of course, Amazon responded to B&N within 8 hours, but not everyone is as nimble as Amazon.