"Xbox 360 to receive price cut by Christmas," that old chestnut that refuses to die, has reared its ugly head once again. This time the news comes from Taiwanese manufacturers who claim that Microsoft has negotiated a lower cost for 360 production and will reduce the retail price of 360s by US $100. According to these Taiwanese sources, cheaper components and a more refined production process could reduce overall production costs by 15-20%. Additionally, this would allow Microsoft to bundle the HD-DVD drive while staying under $399.
Of course, Microsoft Taiwan has denied the rumor. And, it should be noted that cheaper production costs do not necessarily lead to cheaper retail prices. Not only that, but with the core system already being a full $200 cheaper than the low end PS3, Microsoft doesn't really need to lower its price.
Who knows, it might actually be true, but don't hold your breath. The much ballyhooed PGR and Points bundle is much more likely.