Speculations surrounding the Redmond Company's next market strategy concerning the Xbox 360 console were focused on a potential and substantial price discount. In this context Microsoft was rumored to consider a price drop of no less than $100. Consequently, the Xboc 360 Premium package would have dropped from $399 to just $299. This measure was correlated by speculations with the upcoming launch of PlayStation 3 console from Sony, due this fall.

Although Microsoft representatives have stated numerous times that they are content with Xbox's market performance, announcing sales of in excess of 5 million units since its launch, Microsoft is still second to Sony, and the Japanese console builder is yet to launch its PS3. Moreover, recent studies have shown that avid console gamers would rather wait for the Sony product than switch to Xbox 360.

But the news of the price reduction for the Xbox 360 was denied by Microsoft. According to sources from within the Redmond Company, Microsoft has no plans involving cost reduction by the end of 2006. In reality such a discount is far from possible as the Microsoft's Home and Entertainment Division posted record $1.26 Billion losses related directly to the performance of Xbox 360.