Xbox is set to drop the price of the 360 HD-DVD add-on from $199 to $179 on August 1st in the US, reports
The firm will also offer five free HD-DVD movies with the hardware from a selection of 15 titles, which is an extension of Toshiba's HD-DVD promotion initially available on standalone players.
Microsoft is also promoting the HD-DVD release of 300 and Heroes: Series One by offering the HD version of 300 on Xbox Live Marketplace from August 14th and alongside the pilot episode of Heroes.
On the other side of the format war, Sony is championing a similar offer, whereby customers can choose five movies from a list of 21 titles. The offer began in July and will run through to September.