The DigiTimes are reporting that the HD DVD drive for the Xbox 360 will retail at $200 and are second guessing that it will mean a price tag of £100 in the UK. Of course we know it doesn't normally work like that, so we'd expect a slightly higher price for the UK market, but it does confirm what we'd hoped for.. that the HD-DVD drive will be the cheapest available.
This is bad news for Sony who are hoping that the inclusion of a built-in Blu-ray drive in the PS3, plus backing from a number of high profile movie studios, will tempt consumers to opt for their next gen console. Microsoft have achieved their aim of being able to offer their add-on and the Xbox 360 at a cheaper price that the PS3, if reports of the 60GB model being released at £425.00 are correct.
There's not a huge difference in price however, and the PS3 does have an extra 40GB of storage on the top-end model, so it's likely to be the content that will sway consumers.

Both formats are similar in many ways, but Blu-ray can hold 25GB per layer, 50GB on a dual-layer disc, whereas HD DVD can only hold 15GB per layer, 30GB on a dual-layer disc. This extra capacity on the Blu-ray format is said to mean that studios will be able to offer a higher-quality audio and visual experience to consumers than HD DVD.
The Digitimes states that the drive will be in shops before Christmas.
Source : Digi Times
Image credit : Google
Article amended: 16/08/06 : 2.45pm - 3rd paragraph added and 2nd paragraph extended.