The Associated Press reports that Microsoft is trimming the price of its
Xbox 360 video game console to make way for a new model with a bigger hard
drive.
Starting Sunday, Microsoft's mid-range Xbox 360 console with a 20-gigabyte
hard drive will cost $299 in the U.S., down from $350.
Blogs have carried rumors of the decision since June, when photos depicting
the $299 price tag were posted to the Internet.
An updated Xbox 360 is set to arrive in stores in early August. The $350
replacement will sport a 60GB hard drive, significantly more space for storing
the games, TV shows and movies that Microsoft sells on its Xbox Live
Marketplace Web site.
Microsoft is also expected to give the Xbox a little extra appeal by streaming
movies and TV episodes through a high-speed Internet service offered by
Netflix. The long rumored deal could be announced as early as Monday at a video
game conference in Los Angeles.
Microsoft did not adjust prices for its more basic Xbox 360 Arcade version,
which has just 256 megabytes of storage and costs $280, or for the Xbox 360
Elite, a $450 model with a 120GB hard drive.
The Redmond, Wash.
based company released its next generation game console in 2005, a year ahead
of competing machines from Nintendo and Sony.
Since May, Microsoft had sold 10.3 million Xboxes in the U.S.,
according to data from market researchers, NPD Group. By comparison, Nintendo
had sold 10.2 million Wii consoles, and Sony had sold 4.5 million PlayStation 3
machines.
Nintendo has kept the Wii's price at $250 since its U.S. launch in November
2006, while Microsoft and Sony have made several cuts to console prices in
different regions. Currently, PS3 models cost $400 to $500 in the U.S.