As we reported at two minutes past midnight this morning (and the first UK site to do so), Microsoft are cutting the price of the Xbox console in Europe.

The UK retail price of the machine will be 199, and anyone who buys a machine at the full price before April 26th will be entitled to claim two games, plus an extra controller - totally free of charge.

Details of the free games, and how to claim them, will be made available from www.xbox.com/uk, and Microsoft say they're offering this scheme as a thank you to all the customers who helped with the early success of the system.

"This is a long-term, strategic move that will benefit our retail partners, our third-party publishing partners and ultimately the gamer" said Sandy Duncan, Vice President of Xbox Europe.

A price cut has also been announced today in Australia, but there are said to be no plans for any immediate changes to the price of the machine in either America or Japan.

It will be interesting to see if Sony now go for a further drop in the price of their one year old PlayStation 2, and how the cut in price of Xbox will effect Nintendo's Gamecube which launches on May 3rd.

Related article: Xbox gets slashed to under 200