Earlier today I speculated that Microsoft would be quick to cut prices on their 360 line-up in order to kill Sony's 'Slim' advantage. It appears that there is some evidence they are doing just that. Engadget reports on a leaked ad from earlier this week, announcing that the Xbox 360 Elite will be replacing the Pro at the $299 price point.

The Elite is currently the most expensive console on the market, coming in at $400. Now that Sony has slashed PS3 prices, that can't be allowed to continue. Microsoft anticipated their move early, and prepared this slash in order to compete with them right away. The announcement is due for August 30th, which should give just enough time for the hubub around the Slim to die down.

If Microsoft is smart, the Elite won't be the only 360 that sees a price cut. If they really want to stick it to Sony, they need to slash another $25 bucks off, and drop the Elite under the Slim's price. It might hit their pocket book a bit, but since the 360 is the only console still selling right now, I have a feeling they can handle the strain.