In a truncated interview with 1UP (the full version is coming), Microsoft’s Shane Kim discussed what he believes is a mass-market price. “If you look back in history—again, it’s not just going to follow what’s in history—in some cases, 75 to 80 percent of the business gets done $199 and below. … Maybe $249 will be a mass-market price point—but historically, $199 has been when you’re talking a PlayStation 2-like install base.”

He also went on to say July was an “odd” time to announce a price drop, when referring to the PlayStation 3 price drop. Additionally, Kim even said, “I’m not even sure Sony announced a price reduction, anyway,” referring to the fact that there was initially a $499 PlayStation 3 available, and today there is no cheaper option than $499 if you’re looking for a new PS3.

It’s hinted that a price drop may be in store this year, and to “stay tuned” – Kim acknowledged that this holiday is extremely important for Microsoft to win. So if you’re holding off for a price drop to pick up an Xbox 360, don’t lose hope just yet.