Rich Fiscus
7 Aug 2007 7:56
Microsoft announced that Xbox 360 prices will drop to $349 for the 20GB model, a $50 price cut. A basic console without a hard drive or wireless controllers will retail for $279, $20 less than its current price, while the Xbox 360 Elite, a black version with a 120-gigabyte hard drive and high-definition video support, will drop $50 to $449.
The new prices will be effective tomorrow, almost exactly a month after rival Sony slashed the price of the PS3 $100 to sell the remaining stock of first generation models in preparation for the launch of a newer version.
Microsoft says the cuts aren't related to Sony's move. The official announcement specifically mentions the release of Madden NFL 08, which it notes was the top selling console game last year.
"There is nothing too shocking about this," said Michael Gartenberg, an analyst at JupiterResearch. He said it's normal for companies to cut console prices between one and two years after launch.
The analyst added that the $50 price cut will bring in a whole new group of customers who ruled it out at the higher price, and that Microsoft should enjoy increased sales immediately - even though the official holiday shopping season is still months away.
Microsoft also said that the green and gold "Halo 3"-themed console, will go on sale in September for $400.
Sources:
Associated Press
Microsoft