Microsoft follows suit after Sony announces a price drop for their PlayStation 2 console


Microsoft announced today its plans for a North American price reduction of the Xbox. Effective immediately, Xbox will have an estimated retail price of $199.99 in the United States. The price reduction will be supported by a multimillion dollar national merchandising and marketing campaign set to begin this weekend. Microsoft also announced it is reducing the price of Xbox in Japan to 24,800 yen effective Wednesday, May 22. Xbox was originally priced at $299.99 in the United States, $459.99 in Canada and 34,800 yen in Japan.

With its cutting-edge technology, advanced graphics engine, hard disk drive and built-in Ethernet port, Xbox has been globally acknowledged as the most powerful video game console in the world. And with a rapidly expanding games portfolio featuring such titles as Game of the Year <i>Halo</i>, Xbox has become the system of choice for millions of enthusiasts around the globe. "This new, lower price makes Xbox the best value among all competing video game systems," said director of worldwide Xbox marketing at Microsoft, John O'Rourke.

O'Rourke acknowledged that speculation surrounding a pending price reduction of Xbox has been pervasive in the last few weeks. "The traditional forum for making an announcement of this magnitude is the Electronic Entertainment Expo (E3) next week, but we've been ready to go for some time and can easily put this in place at retail now. We see no reason why eager gamers should have to wait a week to benefit from this tremendous value opportunity."

Microsoft currently expects to ship 3.5 million to 4.0 million Xbox consoles for the fiscal year ending June 30, 2002. The company is not providing any update to financial guidance provided on April 18, 2002.