Xbox sales double post-price cut

Although some questioned if the Xbox's $30 price cut went far enough, it looks like the reduction is having the intended effect--in the short term, at least. According to a statement released by Microsoft, sales of its console have more than doubled since the price was lowered last Tuesday. "We're working hard to keep pace with consumer demand," said Corporate Vice President of Global Sales Mitch Koch.

However, many remain skeptical of the Xbox's sales volume. "The question is whether or not it's sustainable," said analyst P.J. McNealy of American Technology Research. "My instinct says that it's going to be shorter than they hope." Other analysts speculated that the sales volume would have been even higher had Microsoft not announced the $169 Xbox-Halo bundle three days later. The limited-edition bundle was so sought-after, many retailers sold out within hours of its announcement.

The Xbox's retail honeymoon could also be cut short if, as expected, Sony reciprocates with a PlayStation 2 price drop. Many industry-watchers expect the drop to coincide with E3, the game industry's central expo, in mid-May. One intriguing theory is that Sony is planning a two-tiered pricing strategy, to one-up Microsoft, by offering the PS2 for $129 and by offering a PS2 bundled with a broadband adapter for $149.