Microsoft has heightened the console price war by offering an Xbox One bundle including a 1TB memory console, two free games as well as $50 credit available from Microsoft online store for $399.

A report in IB Times states that the news was announced by Microsoft's Larry Hyrb on Twitter on the same day when Sony announced that they will launch a 1TB PlayStation 4 next month at an undisclosed price. Earlier this month, Microsoft announced that the 1TB Xbox One would be available for $399, while slashing the price of the 500GB model to $349.

The Xbox One 1TB bundle will be available from Microsoft's online store and it comes with 'Halo: The Master Chief Collection' in addition to another disc-based game having a maximum retail value of $59.99. In fact, the second free game offered by Microsoft is part of a promotion by the Redmond-based company and will run from June 21 to 27. In other words, people purchasing any Xbox One during this period will avail the second game. On the other hand, the $50 store code will be available until June 30.

The new Xbox One controller allows players to plug in standard 3.5 mm headsets directly, eliminating the need for an adapter. However, people who have already purchased a headset adapter can plug it into the new controllers to make use of the built-in volume controls.

At present, the PlayStation 4 also retails for $399, which is the same price as the bundle, and includes a 500GB console, headset and controller. In addition, purchasers are given one free game. They can choose between 'The Last Of Us' or 'Batman Arkham Knight.'