The company has also said the drive will be available as a limited edition bundle packaged with King Kong - naturally on HD DVD. The package will also come with the Xbox 360 Universal Media Remote.
Microsoft clearly has big designs for the drive, calling it the 'ultimate home-theatre experience'.
"The Xbox 360 HD DVD Player is the best high-definition movie experience and value on the market," said said Richard Teversham, the European director of marketing and platform, Xbox.
Teversham also takes the opportunity to make toe the company line for HD DVD, which the new drive can display in full 1080p glory.
"The reviews, the word of mouth and the consumer response have all been crystal clear - HD DVD is the format of choice. We're not forcing movie technology on game players but are instead letting them choose how to personalise their experiences. If they want HD DVD, there's no better value out there." Dan Grabham