Microsoft: No Price Drop for Xbox 360

Darren Huston, president of Microsoft Corp.'s Japan unit, gives business strategy for the new fiscal year at a press conference in Tokyo Monday, July 9, 2007. Huston said Microsoft has no plans to cut the Japanese prices of its Xbox 360 video game console. (AP Photo/Shizuo Kambayashi) (Shizuo Kambayashi - AP)

TOKYO -- Microsoft has no plans to cut the Japanese prices of its Xbox 360 video game console, the head of the U.S. software maker's Japan subsidiary said Monday _ even as rival Sony cut the U.S. price of its PlayStation 3 by $100.

Darren Huston, Microsoft Corp. corporate vice president, told reporters at a Tokyo hotel that Xbox 360 prices in Japan are "very competitive," noting that the Japan price is below the U.S. price. Xbox 360 sells for about 38,000 yen ($300) in Japan, and $399.99 in the U.S.

Sony Corp. announced Monday that it was slashing the price of the PS3 console to $499 from $599. But it has has no plans to reduce the Japan price for the game machine from 59,000 yen ($480), said Sony Computer Entertainment Inc. spokeswoman Nanako Kato.

Sony also said it will offer a model with a bigger hard drive for storing downloaded content such as video games and high-definition movies for $599 in the U.S., starting in August. Kato said there are no plans so far to offer the new 80-gigabyte PS3 in Japan.

Microsoft, Sony and Nintendo Co. are engaged in a fierce competition in the game business. Microsoft's Xbox 360 has struggled in Japan, where gamers are opting to buy the PS3 and Nintendo's Wii.

Microsoft said last week it's spending $1 billion to repair problems with the Xbox 360, including those sold in Japan.

Huston said Microsoft has boosted its image in Japan, the company's biggest market outside the U.S., over the last three years, but needs to do more to enhance its corporate business and expand network-related services for the home.

Microsoft will boost employment in Japan by 400 people, or 17 percent, of today's 2,300 people to beef up operations, including quality controls, he said.

Microsoft has sold 11.6 million Xbox 360 machines worldwide, and does not disclose how many were sold in Japan.

Nintendo has said it sold 5.84 million Wii machines worldwide in the five months since its release in November, 2.37 million in the Americas, and 2.0 million in Japan. The Kyoto-based company said it expected to sell 14 million more Wii machines in the fiscal year ending in March 2008.

Sony has shipped 5.5 million PS3 machines in the fiscal year through March.