Although the price drop wasn't as big as expected, a $20 drop is better than nothing. The drop came as the PS2 was also announced to go down to the exact same price. So it seems the price war almost became a competition at E3.
The Gamecube already at $149.99 also offers a free game with its system as part of it's new pricing plan to remain competitive in the face of fierce price competition from both Microsoft and Sony.
