The rumors about Microsoft’s move were flying around for months, but it seems like on Sunday the Redmond-based company will make the official announcement.

Already Target, one of the biggest gaming retailers, has already displayed on its website, a $299 price for Xbox 360.

Since the beginning of the year, Microsoft’s Xbox 360 registered poor sales in the United States, being almost constantly outsold its rivals, PS3 and Nintendo Wii.

That’s maybe the reason why Sony officials said won’t consider a price cut for PS3, at least for this year. PlayStation 3 was released in November 2006 in Japan and US and the gaming console is being currently sold for $400 in US.

Instead, as Sony CFO Nobuyuki Oneda said the company wishes to make its console more profitable. In a report released last month, Forbes said that Play Station 3 has cost Sony an incredible $3 billion, mainly because of the company’s pricing strategy for the product.

As PS3 hit the market, Sony wanted to recover some of the market share that Microsoft’s Xbox 360 had gained, mainly due to its launch a year before PS3’s. Sony thought that by selling its consoles at a price that would be a little less that their actual cost, it might gain more market share and it would be able to use it to make profit for the company from exclusive gaming titles and sales of its patented Blu-Ray. However, Sony has managed to win the Blu-ray versus HD DVD battle due to its PS3.

What is more, after enough units would have been sold, production cost would have dropped, and Sony would have ceased to sell PS3s at a loss. Even though the PS3 console seems to have gotten a few very good exclusive titles recently, and has shown signs of recovery during the past months, it is still a long way to go until Sony will be making a decent profit out of it.

In case that Microsoft will confirm the new price tag of $299, Sony’s PS3 will remain the most expensive console on the market. However, Sony is decided to keep the current price.

Bloomberg News reports that speaking about this issue, Sir Howard Stringer said in an interview that Sony won’t lower the price of its PS3 and he added that a price reduction by Microsoft would be evidence that the Xbox 360 was falling behind in the contest for sales.

Few weeks ago, Nintendo officials made a similar statement, saying that no price cut for their successful Wii are considered for this year.