Starting today, Microsoft's mid-range Xbox 360 console with a 20-gigabyte hard drive costs $299 in the United States, down from $350.
Blogs have carried rumors of the decision since June, when photos depicting the $299 price tag were posted to the Internet. An updated Xbox 360 is set to arrive in stores in early August.
The $350 replacement will sport a 60-gigabyte hard drive, significantly more space for storing the games, TV shows and movies Microsoft sells on its Xbox Live Marketplace Web site.
Microsoft also is expected to give the Xbox a little extra appeal by streaming movies and TV episodes through a high-speed Internet service offering by Netflix. The long-rumored deal could be announced as early as tomorrow at a video game conference in Los Angeles.