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Microsoft disputes report of Xbox delay

Shares in video game software makers dive after reports that the software giant's game console may be delayed, but the company denies the report.

Shares in video game software makers dove Wednesday, after London's Financial Times reported that Microsoft's Xbox game console may be delayed.

The Times articles said final developer kits, which allow other companies to create hardware and software for the Xbox, were delayed, likely pushing back the console's release. Microsoft said the game player will go on sale this fall, with a specific release date likely to be announced next month at the Electronic Entertainment Expo (E3) trade show.

Microsoft disputed the report. "We are still right on track to deliver hardware and software for a launch in fall of 2001," John O'Rourke, director of sales and marketing, said in a statement. "Our developer support and release process is also right on track. Since last September, we've been telling developers that we'd deliver the beta Xbox Development Kit (XDK) units before E3, and we're still on schedule."

Shares in Electronic Arts, the leading publisher of video game software, dropped $4.69, or 8.8 percent, to $48.38. Competitor Infogrames was off 31 cents, or 5.8 percent, to $5.06; while 3DO dropped 15 cents, or 8.8 percent, to $1.62.

The Xbox is Microsoft's high-profile bid to enter the lucrative video game market and expand beyond its traditional PC base. The software giant has said it will devote $500 million just for marketing the console, which will compete against market leader Sony's PlayStation 2.