Entertainment retailer Zavvi has upped the stakes in the Christmas price war, by slashing its price for the Xbox 360 Arcade to under £100.

In a last minute festive sale, the company has reduced the price of the Arcade to £99.99 - the first time it has gone under £100 with a UK retailer since Sainsbury's offer earlier in the year.

Also slashed are prices for the 360 Premium, down to £149.99, and the Elite which has been cut to £199.99.

Sony's PS3 console has not been forgotten in Zavvi's sale and has been cut by £30 to £269.99.

Games such as Gears of War 2 and Pro Evo Soccer have also been reduced to £29.99.

A Zavvi spokesperson said: "Our organisation believes in giving our customers the best deal and service. We've put in place some great offers on Xbox hardware, giving customers the best value possible in the run up to Xmas. We appreciate how people's wallets are being tightened because of the economy".