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Microsoft cuts price of Xbox 360

Widely expected price cut comes as Microsoft also announces a new model with a 60GB hard drive.

Microsoft on Sunday cut the price of its best-selling Xbox 360 Pro model game console with a 20GB hard drive from $349 to $299.

Microsoft on Sunday unveiled an Xbox 360 with a 60GB hard drive. It's expected to go on sale in August. Microsoft

The company also introduced a new Xbox 360 model with a 60GB hard drive. It will go on sale in stores in the U.S. and Canada for $349 in early August.

Microsoft's announcements, which were widely expected, come on the eve of the start of this week's E3 video game industry trade show in Los Angeles.

Rumors of the Xbox price cut swirled on popular gaming blogs Joystiq and Kotaku last week. The two sites received snapshots of Kmart and RadioShack fliers advertising the $299 price.

Microsoft announced in May that Xbox 360 had become the first next-generation video game console to hit 10 million units sold in the United States. All told, Microsoft said it has sold 19 million Xboxes worldwide.