Xbox price officially slashed

Microsoft officially announced a price cut for the Xbox this morning, confirming analyst and industry speculation. The console will now retail for $199 in the United States, down from $299, and it will retail for $299 Canadian in Canada, down from $459.99 Canadian, effective immediately. In addition, the company announced that it will also cut the price of the Xbox in Japan from 34,800 yen to 24,800 yen, effective May 22. At present, there are no plans to reduce prices on accessories or software. This week's announcement will be followed up with a TV campaign and the unveiling of the company's online plans for the Xbox at E3.

The price cut had been in the works for several weeks, according to David Hufford, Xbox product manager at Microsoft. Microsoft has been working with US retailers over the last several weeks to orchestrate the price reduction and put it into effect as smoothly as possible. Following 2865329Sony's announcement of a price cut for its PlayStation 2 console , Microsoft decided to follow suit rather than wait to announce the cut next week at E3.

"We want to make the Xbox more accessible to more people," Hufford said. "That's why we're dropping the price. $199 is the sweet spot for a lot of gamers. It's about making it more accessible to more people. We're all at a 199 bucks, so now it comes down to value. You've got a lightweight, a middleweight, and a heavyweight in the ring right now--with the little guy being Nintendo. Their online announcement could not have been more feeble. It's a cop-out to just announce a component and a game. If you're taking online seriously, you need to enter with a little more force than that. Approaching online from a service standpoint--that's the way gamers want online delivered to them. Microsoft understands that. I think Sony is obviously the middleweight. They've got more power than the little guy. They've announced some games but don't seem to have a clear direction yet. I'd certainly put us in a strong position going forward. We'll be packing some serious heat moving forward, with some great games you'll hear about at E3."