GamesIndustry.biz has confirmed that Microsoft has reduced the price of the "core" Xbox 360 to £199.99 in the UK. This is and isn't a big deal. You see, the previous price was £209 and many retailers had already begun selling the core system for £199, taking a hit on their own profit margins. So, no, a £10 price drop doesn't seem like much, and it isn't.

However, this is a big deal because it's the first "official" price cut for the Xbox 360. Prior to this announcement, MS was extremely tight-lipped about it, even hinting that there would be no price cut of any kind. What does this mean for the US market? Well, if MS follows suit, and reduces the price of the core system, we may just see a $250 Xbox 360 this Christmas. With Sony scrambling to replace lap top batteries and begin production of the PS3, such an announcement would be salt in the wounds. We'll just have to wait and see.