BETTER AND CHEAPER:

Fun for less: Xbox price falls (Benjamin J. Romano, 8/07/07, Seattle Times)

This won't surprise many close watchers of the video-game business. Microsoft is lowering the price of the Xbox 360, effective Wednesday, to lure more buyers to its console as the next edition of one of the most popular video games of the last decade — "Madden NFL" — goes on sale next week. [...]

The hardware changes and engineering improvements the company made to reduce an "unacceptable" console failure rate did not affect the timing of the price cut, Greenberg said. In July, Microsoft extended the warranty covering general hardware failures that had plagued the Xbox 360 and set aside $1 billion to deal with the problem.

The pricing strategy further separates the Xbox 360 from the Sony PlayStation 3, which saw a price reduction of its own and a new model introduced last month.