Redmond, Wash. - Microsoft on Tuesday announced that it will cut the price of its Xbox 360 video game console in the U.S. by $50, from $400 to $350, following Sony's discounting of the PlayStation 3 from $599 to $499 last month.

"The fact that we have been able to keep our launch price longer than any other console while retaining our leadership position demonstrates that consumers believe in the value of Xbox 360," said Mitch Koch, corporate vice president of the global retail sales and marketing group at Microsoft's entertainment and devices division.

Microsoft also slashed the price of its basic Xbox 360 by $20, to $279, and the Xbox 360 Elite by $50, to $449.

The company said the move was partly timed to coincide with the release of EA's "Madden NFL 08," which comes out next Tuesday.

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