Microsoft Corp., the world’s largest maker of software and a strong backer of HD DVD format, has quietly slashed pricing of its add-on HD DVD drive for Xbox 360 game console. The decision enables owners of the latest game machine from Microsoft to watch high-definition movies for only $129.

Currently Amazon.com and Toys R Us online stores sell external HD DVD drive for Microsoft Xbox 360 for $129, but it is unclear whether this is a limited time offering, or Microsoft will continue to sell its add-on for that price going forward. Given that the device has not become truly popular, according to some estimations, it would be logical for the software giant to slash the pricing of the HD DVD drive to $129 permanently.

Initially HD DVD drive for Xbox 360, which can also be plugged to any personal computer, cost $199, but starting from August 1, 2007, Microsoft started to sell it for $179.

The least expensive version of Microsoft Xbox 360 costs $279, therefore, when combined with the external HD DVD drive, the bundle will cost $408; a little more than $399, the cost of the Sony PlayStation 3 40GB, which can playback Blu-ray movies, the format that rivals HD DVD.

Microsoft did not release any official statements on the matter.

Microsoft Xbox 360 console is based around microprocessor developed by IBM, high-definition visual processing unit designed by ATI Technologies, I/O controller engineered by SiS and some other key components. The gaming machine provides a broad set of multimedia capabilities in addition to games. Currently Microsoft Xbox 360 is available for $279, $349 or $449 depending on the version.