Microsoft is rumored to be issuing price drops for its Xbox 360 units this coming September. According to rumors, the price of the Xbox 360 Arcade will be dropped to $199. There will then be $50 price cuts on both the 60GB Pro and the 120GB Elite units, putting them at $299 and $399, respectively.

This move could be Microsoft’s way of stemming the resurgence of the Playstation 3, which is still third in the console race but fast catching up to its competitors.