Gamespot writes;

With the Pro’s demise, the Xbox 360 will have two SKUs: the $299.99 Elite and the $199.99 Arcade, which has 512MB of built-in memory for game saves and Xbox dashboard software installs. The price of the latter console will remain the same.

The Elite’s reduction comes exactly one week after Sony announced the $299.99 PlayStation 3 Slim at GamesCom in Germany. However, despite the fact the Blu-ray and Wi-Fi-equipped PS3 now matches the Elite in terms of memory and price, Greenberg still feels the latter is a better value. He pointed to 360 software exclusives, like Halo 3: ODST and Forza MotorSport 3. and Xbox Live’s online features, like Netflix and the forthcoming Last.fm, Facebook, and Twitter integration, still set for “this holiday season.” He also said price was a major factor for the 360 selling well.