Microsoft won't confirm price cut rumors

Microsoft won't comment upon online images reportedly showing upcoming newspaper advertisements from retailers Wal-Mart and Toys R Us.

These advertisements list the retail price of the premium model Xbox 360 as USD $349, which represents a USD $50 drop from the current price. No elite or core model pricing was shown.

Historically, most recent consoles have had a price drop by this point in their lifecycle. Earlier this month it was reported that Microsoft had developed a smaller chipset for the Xbox 360 which would allow them to cut production costs.

Even so, Microsoft is not commenting on the latest price drop rumours and has made no official announcement.

A similar situation arose last month with the PS3 when a Circuit City advertisement showing a USD $100 price drop was posted online. Sony initially denied the price cut, only to confirm it a few days later.

Retailers such as Best Buy, Target, Toys R Us, and Wal-Mart have refused to comment until an official announcement has been made.