Hold your fire, gamers: Xbox 360 and PS3 price cuts due this fall

Parents and gamers coming of age may be in for a break later this year, as it is rumored that both the PlayStation 3 and the Xbox 360 will have price cuts. Technology site Ars Technica claims that both Sony and Microsoft will drop their prices in order to better compete with the Nintendo Wii, later this year.

While there are always rumors about price drops in the video game market, Joystiq.com points out that the Mole at Ars Technica has a solid reputation in knowing what's going on in the industry.

On top of the Mole's past performance, history shows that it's time for another price drop, and a significant one at that. The Xbox 360 has already seen three price drops, which have given it an edge over the pricier PlayStation 3; but it hasn't yet reached the halfway price point that its predecessor, the Xbox, did by the fourth year of its release.

Given Microsoft's focus on digital downloads, I'd venture a guess that Microsoft will try to offer an Xbox 360 with hard drive for $199 -- half of what it cost when it launched in 2005. The Mole also predicts that Sony will be introducing a new, slimmer PlayStation 3, which will also cost less, although it's harder to estimate exactly how much less.

The reason these price drops are more significant than in years' past is that by the time the original Xbox and the PlayStation 2 were discounted to half price, new systems where practically ready to hit the shelves. Microsoft has publicly stated that the Xbox 360 is not even halfway through its life, and that it is opting to focus on Project Natal, a new motion sensing technology for the Xbox 360 that will work with all current Xbox 360 consoles. Likewise, Sony is focusing on motion-capture technology of its own in an attempt to live up to its promise of a 10-year PlayStation 3 console.

So if you're sitting on some cash looking to buy a video game console, and you can handle playing on a friend's machine for the next three to four months, it may be worth your wait as consoles will be cheaper (and in the case of the PlayStation 3, smaller and quieter) in the near future. On top of the discounted prices, expect to see new holiday bundles that come complete with two-three games at the new lower prices in October, making it even cheaper to get started.

If you're more interested in Nintendo, be on the lookout: At least one insider thinks that a new version of the popular Wii, dubbed the WiiHD, will be released as early as next year.
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