Microsoft has confirmed that it will release a new model of the Xbox 360 in North America, along with announcing a price cut for the 20GB model over there.

The new model will come with a 60GB hard drive and will cost North Americans the same as the 20GB console was - $349 (£176). Microsoft hasn't pinned an exact release date on the new stock keeping unit (SKU) but has said that it will be released in "early August".

The 20GB Xbox 360, which previously cost $349, will come down to $299 (£151). The price drop is effective immediately.

The new SKU gives gamers 20GB more storage space than the standard 40GB PS3 and costs $100 (£50) less. The Wii, meanwhile, sits at $249 (£125).

Microsoft says that the 20GB 360 will be available at the cut price "while supplies last", meaning that when the existing stock has sold out the SKU will no longer be available over there. This would seem to be industry standard now - when Sony released a new version of the PS3 and dropped the price of the 60GB SKU, the older model stopped being available once all the existing stock sold through.

There's no price cut for the Elite or Arcade 360 packages.

SPOnG has contacted Microsoft to see if it has any plans for a similar price drop or new SKU in the UK, but no comment was available at the time of press.

This comes after plentiful rumour and speculation that such a move was on the way.