Poor Xbox sales force Microsoft to cut price

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The Independent Online

Microsoft has slashed the price of its Xbox video games console by a third in Europe and Australia, one month after its launch, in a move that the industry has taken as a sign of disastrously bad sales.

From 26 April the Xbox will cost £199 in Britain, down from £299, a 34 per cent cut. In Europe the price will fall to €299 (£184) from €479, a 38 per cent cut. People who have already bought and registered the machine will receive a "thank you" package of two games and a video controller normally priced at about £115.

The cut puts the Xbox at the same price as Sony's Playstation 2, but industry figures suggest Sony's machine is now outselling the Xbox more than fivefold, despite being 15 months old. The Xbox was launched in Europe last month and had a multimillion-pound marketing push from the Seattle company, better known for its Windows software.

It is the first price cut for the games console, which launched in America last November and in Japan in February. Microsoft has not made price cuts in those regions.

Retailers and analysts welcomed the move, saying it should stoke sales for the Xbox just as demand was waning.