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Microsoft has increased the storage capacity for it's Premium system SKU bundling a 60 GB hard drive instead of a 20 GB hard drive. The Premium system is still $350 even with the added hard drive space. The 20 GB SKU dropped in price to $300; a $50 savings. Buy a 20GB system from Target and they'll throw in a $25 gift card.
There's no price drop mentioned in the announcement for the 120 GB Elite system or the "no hard drive" Arcade system.
E3 is this week. Look for more announcements from Microsoft starting tomorrow (Monday) about entertainment hardware and software.

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