Microsoft is making a new attempt to keep up with its competitors, Sony and Nintendo, on the Japanese market. The US company announced a new price for its Xbox 360, which starting next week will be cheaper than Nintendo Wii.

The Xbox 360 Arcade edition, which comes with no hard drive, will be priced at 19,800 yen ($180), nearly 30 percent down compared to its previous price tag.

By comparison, Nintendo Wii, which made a name for itself as “the cheapest gaming console”, is selling in Japan for 25,000 yen ($230).

The price cuts will affect the other version of Xbox 360 as well. Foe example, the 60 GB edition will be released in Japan at 29,800 yen ($270).

The top of the line, the Xbox Elite, will have a price of to 39,800 yen ($370) instead 47,800 yen ($440).

In fact, the Japanese gaming market has proved to be a tough one for Xbox 360. In more than two years, Microsoft has not managed to reach the one million units milestone and, despite the price cuts, Xbox 360 is lagging far behind its main competitors, Nintendo Wii and PlayStation 3. For example, according to the figures released earlier this year by Enterbrain, in 2007 Microsoft sold in Japan only 235,318 units.

The lack of attractive game titles, conceived especially for the Japanese market, is considered to be one of the reasons that cause for these poor sales.

However, Microsoft repeatedly claimed its interest for Japan and made several efforts to release new titles. Still the company failed to secure exclusive deals with the Japanese game makers.

For example, last month, Japanese game developer Square Enix Co Ltd invited the video game enthusiasts to an event held in Tokyo, meant to provide a peak at several upcoming releases, including trailers for the Final Fantasy XIII series, news and also new information on other games.

While Final Fantasy XIII game will also be available on Sony Corp’s PlayStation 3 and Microsoft Corp’s Xbox 360 in the United States and Europe, the new title will be an exclusive for the PS3 in Japan.

The price cuts in Japan could be also a signal that Microsoft is preparing a similar move for the US market.

Microsoft has slashed the price of the 20 GB Xbox 360 to $299 right before this years E3, but the model was also discontinued and the prices of other versions were left unchanged.