Microsoft chops price of Xbox

AMERICAN giant Microsoft has slashed a third off the price of its Xbox games console, just five weeks after launching it in Europe. The move will raise suspicions that the software titan is making less headway with its first games console in overseas markets than it expected.

The price cut brings an Xbox down to £199 from £299 in Britain and to e299 (£184) in the rest of Europe, directly matching the price charged by Sony for its market-leading PlayStation 2.

There have been growing suspicions that, despite strong sales in Microsoft's domestic market, it is struggling to make inroads into PS2 sales elsewhere. Microsoft has declined to release sales figures in Japan or Europe, but is targeting global sales of 4.5m consoles by June.

Disappointment over initial sales in overseas markets is thought to be a factor behind the recent resignation of Microsoft president Rick Belluzzo. Its European vice president Sandy Duncan said today's move was to ensure more people could afford an Xbox.