With cutthroat competition among console makers, Microsoft needs to entice potential customers as its rivals move aggressively to stay ahead.
Microsoft's price cut on the Xbox 360, beginning Wednesday, as well as a slew of game releases in the next few months for the console, including Electronic Arts' (ERTS) hit football title, Madden NFL 08, Halo 3 and Activision's (ATVI - Get Report) Guitar Hero III, should keep gamers interested.Microsoft said the Xbox 360 -- with a 20GB hard drive, wireless controller and headset -- will now sell for $349.99. The Xbox 360 Core System has been priced $20 lower at $279.99 and the Xbox 360 Elite, with a 120-GB hard drive, will be sold at $449.99 -- a discount of $30. Sales of Xbox 360 could jump up by as much as 35% to 50% estimates Michael Pachter, an analyst with Wedbush Morgan, which does not own shares or have an investment banking relationship with Microsoft. Shares of Microsoft were down 20 cents, or 0.6% to $29.34 in recent trading.