Sega is expected to slash the price of its Dreamcast console in Japan by a third in a bid to get a lead on its competitors Sony and Nintendo.
The price of Sega's Dreamcast console will drop to $164 from the end of June in Japan, sources said. Sega was unavailable for comment. Last month Sega confirmed that the pricetag for the console will be $199 when it launches in the US this autumn and £199 in Europe.
"They really are looking very seriously at the competition, things may change - it is very much like the digital TV market, you've got to win over consumers and quickly," said one industry source. The price cut in Japan would be a way to get an edge on rivals, especially arch rival Sony, which has its Playstation II waiting in the wings.
Sega Dreamcast will be the first network ready gaming console with a built in 56kbps modem included as standard worldwide and will come with access to the Sega Dreamcast Network, which enables consumers to play interactive games with other players. The Network will initially offer the Sega Rally Championship2 game and Baldur's Gate, a medieval adventure title.
Network users will receive regular updates via email, detailing games and providing them with hints, cheats and other information.
To promote Dreamcast, Sega has struck a deal with Pepsi to include it as a feature in a number of its adverts scheduled to appear in the runup to blockbuster summer movie titles, such as Star Wars: Episode 1. Sega is spending $100 million on promoting Dreamcast, including an extensive advertising campaign on MTV.
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