Reports are coming out that Microsoft is planning to discontinue the Xbox 360 Elite. Well, sort of. According to MS, they're going to stop taking orders of the Elite during Q2 and existing stocks will be sold off. Mind you, this is just the regular retail version. 360 Elites will continue to be made but instead will be sold as special limited edition game themed consoles, such as the Resident Evil Red 360.

The Elite is currently the most expensive console in the Xbox line, currently selling for $399. This puts it on par with the 80gb PS3. There isn't a lot separating the elite from the cheaper 360s at this point. Originally, it was the only one to offer HDMI connectivity and a beefy 120gb HDD. Now all 360 models feature HDMI and the Pro has a 60gb drive. Compared to the PS3, the Elite lacks optical HD video playback and built in wireless LAN. Therefore, it's getting difficult for Microsoft to justify the high cost. This is likely why it's going to be offered in limited edition bundles, while likely retaining it's current price.

Source: The Register