Nintendo, most famous for its franchise character, the squat and rotund plumber Mario, lowered the U.S. price to $149.95 from $199 effective May 21.

"We were thrilled to be able to come out at $199 ... so we're just going to be ahead of the game at 149," Peril Kaplan, vice president of corporate communications for Nintendo, told Reuters. "We started aggressive and this just continues it."

Kaplan said there were no plans for hardware price cuts in other regions, nor are there plans to cut the price of top software titles from $49.99.

Nintendo's two main competitors, Sony Corp. and Microsoft Corp., cut the North American prices of their consoles, the PlayStation 2 and the Xbox, to $199 from $299 last week,

As opposed to those two consoles, the GameCube has been positioned in the market as a lower-priced alternative appealing mostly to children aged 6-14, a demographic Nintendo has dominated for nearly 20 years internationally.

The company said it has shipped 4.5 million GameCubes worldwide to date, and 2.5 million units of its top title "Super Smash Bros. Melee."

The GameCube was released in Japan in September, in the U.S. in November (three days after the Xbox), and in Europe earlier this month.

Last week Nintendo said it would release adapters in the fall to allow people to play games online with the GameCube, though it said it is in no rush to produce games itself for the online service.

Nintendo's shares have dropped 20 percent since the start of the year in Japan, due in part to profit-taking after a year-end rally fueled by strong pre-holiday sales, but also reflecting market concerns about discounting and rising competition.

INDUSTRY CONVENTION STARTS TODAY

Later on Monday in Los Angeles, a Microsoft media conference will kick off the Electronic Entertainment Expo, better-known as E3, the video game industry's annual trade show.

Most of the news about price cuts that was made in the last week had been expected to come at E3, leaving analysts to speculate that the show will now return to its roots and focus primarily on new games for the various systems.

Nintendo plans to release GameCube games later this year based on its most popular franchises -- Mario, "Zelda" and "Metroid" -- all of which are expected to be exhibited at the show.

"I think Nintendo will come out of (the show) stronger than they went in," John Davison, the editorial director of the Ziff Davis Media Game Group, told Reuters last week.

Davison said Nintendo was virtually guaranteed to do well later this year, as "Super Mario Sunshine" and its other franchises titles have an eager audience among people who have been playing games in those series since Nintendo first arrived in the U.S. in the mid-1980s.

The U.S. video game business is in the early part of what analysts and industry executives have said will be a multiyear cycle of record growth, driven by sales of the three consoles and associated games and peripherals.

Sales of video game hardware and software topped $9 billion in the U.S. last year, with 2002 expected to easily beat that record.

By Ben Berkowitz, Reuters