That seems to be fairly substantial confirmation. Well at least for the price of the Elite, but I doubt that Microsoft is immediately moving to a two sku model. I would imagine it is a two step process a intermediate premium through the next couple of months. Before they unveil a upgraded arcade for the holidays. A arcade that comes with a hard drive.

They've said they'll match Sony blow for blow, cut for cut throughout this generation. This is just an example of Microsoft following through on that.

Still, an even more intense battle between Sony and Microsoft should be interesting, particularly now they're both preparing to take aim at Nintendo.

Probably, often whenever some of the Sony fans hype something Microsoft gets there first. Its just the nature of the business eh?

^lol, its a seriously back hand slap to sony if this is true

Some advice to fellow members. For those that have been thinking about getting a 360. Early next month looks to be the best time to do so. You will probably find a fifty dollar discount or more on the premiums. So you can get that hard drive for a song.

Well thats good, i didnt think the Elite shouldve been that expensive compared to what it offered than what the Arcade didnt have at their $199 price. Hopefully Sony will have something to counter this soon.

Good news.

Now we have 2 SKUs: A stripped down cheap one, and a very robust upgrade that warrants the extra $100.

Can't argue with that kind of model. If Sony doesn't drop the price this year, Microsoft will bludgeon them, come Christmas.

I don't think a 299$ will have great effect on the market
but if the arcade drop to 149$ i think it will have far more impact

can this really be considered a price drop? the casual buyer / gamer mom will see the same 299 price tag he could see before when buying a "real" xbox 360