Microsoft is to introduce a new model Xbox 360 with a 60 GB hard drive, to retail for USD 349.
The new SKU will go on sale in the US and Canada in early August. The price of the current 20GB model has now been reduced to USD 299.
"We know consumers need more and more space to store the amazing digital content Xbox 360 offers, and we're giving it to them at no extra charge," said Albert Penello, Xbox director of product management at Microsoft.
"No one device offers the depth and breadth of entertainment that Xbox 360 can deliver, and now you'll have three times the storage to manage all that great content."
The prices of the other two Xbox 360 SKUs will remain the same. The Arcade unit sells for USD 279 in the US, and the Elite model for USD 449.