A new price drop rumor has hit the streets running. Supposedly the 360 has a price drop in store as Microsoft may aim to erase the Pro line and drop the price of the Elite system (from $399 to $299).

Kotaku received photos from GameStop employees of new Xbox 360 Arcade boxes listing the 120GB-packing Elite model and drive-less Arcade as the only available Xbox, and no Pro. They also supposedly have a snapshot from a catalogue due to come out August 30th showing the Elite with a lighter price tag of $299.

Rumors started at the beginning of the year but have not picked up much steam until recently. Rumor has it there will be an announcement at GameCom in Germany next week.

The news is exciting on more than one front. History has taught us if one console drops their price, the others will be soon to follow. Nintendo recently hasn’t been playing by precedent, much to the huge success of their Wii, but Sony’s PS3 is in the slumps. If Xbox 360 drops their price, it’s a safe assumption there should be a price drop for the PS3. For those of us who have spent the last few years debating between the Xbox 360 and the PS3, this might be the incentive to lean one way over the other (especially if Sony sticks to their stubborn guns and won’t drop the PS3 price).