US gaming battle reaches boiling point

The games console battle in the US is heading for boiling point with Nintendo slashing $50 off the price of its GameCube to undercut rivals Sony and Microsoft.

Nintendo cut the price of its GameCube in the US from $199 to $149, leaving Sony's Playstation and Microsoft at the $199 mark.

"We believe we came out at the best price and think this will put us in a very competitive position," Nintendo marketing executive George Harrison told the Associated Press.

"Our goal is to get as many hardware units out there as possible so we can sell software against a bigger installed base," he concluded.

The cut coincided with the Electronic Entertainment Expo (E3) in Los Angeles, the video games industry's major show of the year.

The video games market is estimated to be worth around $27bn globally and US sales of software hit $9bn in 2001.

Yesterday, Microsoft launched its online subscription gaming venture, Xbox Live, which will come to market in the autumn.

But experts say that Microsoft has the most to lose in the unproven online market, with a lot of its optimism based on supposition and relying on increased broadband penetration.

Xbox has already seen a price cut of $100 to $199.

In Europe Nintendo has sold 400,000 of its GameCube consoles since the launch on 3 May. Over here the Xbox retails for £199 while GameCube typically costs about £129.