As we have suspected for some time, Nintendo will go ahead and drop the price of the Wii in an attempt to compete better with the recent price drops of both the Xbox 360 and PlayStation 3. Since the price drops of the 360 and PS3, Nintendo has been seeing a slump in sales, while sales have been trending upward on their competitors.

Our sources are confirming that the price drop for the Wii will hit in October and will likely be confirmed by Nintendo in early October. Still, our sources have not been able to confirm how much Nintendo is likely to drop the price of the Wii. It seems that internal discussions at Nintendo have not yielded a final decision of exactly when the company will slash the price of the console.

The decision to cut the price comes as little surprise, since sources tell us that sales of the Wii are already off by more than half what they were this time last year heading into the holiday season, despite some strong title releases for the platform.

While Nintendo is not confirming anything yet, as is their custom, we suspect that the actual price reduction might only be as little as $20 to $30; and our sources tell us that we should not expect Nintendo to move the price of the Wii to $199 to go head to head with the Microsoft Xbox 360 Arcade bundle, which is already at the $199 price point.