Microsoft is poised to reduce the price of the Xbox 360, introduce a new unit, or both, an analyst predicted.
"With E3 around the corner, we can expect Microsoft to make some type of announcement regarding a hardware price cut, the introductory of a new hardware SKU with new features, or both," said EEDAR analyst Jesse Divnich.
Rumors about the introduction of an Xbox 360 with Blu-Ray capability have been swirling around for the past month but remain unconfirmed by manufacturers.
Divnich further predicted that the PlayStation 3 will outsell the 360 in May sales due to the impending release of Metal Gear Solid 4. He also said he expected Sony to cut the PS3's price a month or two after Microsoft's movie, assuming it happens.
Finally, Divnich said Nintendo was making greater strides toward meeting demand in the U.S., as reflected in the sharply declining gray market mark-ups for the console. Wii Fit is still a hefty 62 percent more expensive on the gray market than retail, however.