For weeks now rumors have been swirling about Microsoft slashing prices on all Xbox 360 models. The American version of the rumor has the predicted cut coming next week, and suspicions have definitely been raised today as Microsoft announced that all 360 models in Japan would receive a price reduction.

The new prices, when translated into American dollars, mean that the Arcade will retail for $182, while the Pro will drop to $274 and the Elite to $367. This move means that the Arcade is now substantially cheaper than the Wii, an obvious play by Microsoft to try and syphon away some of the legions of Japan’s casual gamers who have catapaulted the Wii to enormous success.

The price cut comes in the wake of a surge of 360 sales due to the release of Tales of Vesperia, and it would seem that Microsoft is hoping that cheaper consoles will allow it to continue to build momentum in a territory where the Xbox 360 is outsold by the PS2 on a weekly basis. So now the question remains, is this a region-specific price cut, aimed to improve sales in a struggling region? Or, is this a confirmation of the rumors and speculation of across-the-board price cuts, meaning that American gamers will soon also see significantly cheaper systems? Only time will tell, but you can bet we’re keeping an especially close eye on Microsoft’s Redmond offices this week.