By Bernhard Warner, European Internet Correspondent

LONDON (Reuters) - Nintendo Co Ltd said on Tuesday it had sold 400,000 GameCube consoles, or 80 percent of its launch stock, in its first week in Europe.

GameCube launched in Europe on May 3 as Nintendo shipped 500,000 units for its debut. The company said it was delivering daily shipments to retailers, many of which have sold out of GameCubes, while another 500,000 are expected to be shipped over the next seven weeks.

"It has been, without doubt, a very successful launch, and this is set to continue as we bring in more stock on a regular basis in the forthcoming weeks," said Andy Williams, Nintendo UK general manager, in a statement.

The video games market has become brutally competitive as powerhouses Nintendo, Sony and Microsoft all scramble for share of the $20 billion-plus market.

In a separate announcement, Sony put more pressure on its lagging rivals by cutting prices on its top-selling PlayStation 2 and PSX consoles.

Sony said it would slash the price of its PlayStation 2 console in the U.S. by one-third and halve the price of its original PSX in most markets around the world, including the U.S., Japan, Europe, Oceania, Middle East and Africa.

PlayStation will sell for 89 euros in Europe and 49 pounds in Britain.

Last month, Microsoft cut the price of the Xbox in Europe by 38 percent to 299 euros and 199 pounds in the U.K. It also pared its shipments to 3.5-4 million units by the end of June from a prior forecast of 4.5-6 million. Analysts expect it to cut prices in the U.S. as well.

PRICE CUT MOVES GAMECUBE

Nintendo also said consumers are buying an average of 2.3 games with each GameCube purchase.

In a surprise move, Nintendo cut the price of GameCube two weeks before its European launch by up to 24 percent in an effort to stoke demand in what is considered the most competitive video game console market in memory.

The strategy, which priced GameCube at about 100 euros cheaper than rivals Sony's PlayStation 2, the global best-seller, and Microsoft's Xbox appears to be paying off.

The GameCube retails for 199 euros ($180.40) in Europe and 129 pounds ($187.20) in the United Kingdom.

"What's really significant here is that the initial shipment number was so huge," said Stuart Dinsey, managing editor for Games Trade Weekly MCV. "Five hundred thousand -- that's an enormous number."

"Nintendo quite clearly is saying we're going to look to catch up as quickly as we can to Sony and were looking to squeeze Xbox," he added.

Dinsey added that sales of Xbox have picked up since Microsoft cut the price in Europe last month. Analysts have speculated a similar price cut is in the works for the Xbox in the U.S.

EUROPEAN GAMERS

David Gocen, managing director, sales and marketing for Nintendo of Europe, told Reuters earlier this month that the European market has grown in importance for Nintendo, now accounting for over 20 percent of global sales.

As a whole, Europe is considered the third-largest video games market. Industry news letter Games Analyst estimates European video game hardware and software sales will reach $7.5 billion in 2002, accounting for 31 percent of global sales.

As of the mid-April Nintendo had shipped four million GameCube consoles world-wide. It launched the product in the US and Japan last fall.

Despite launching in the traditionally quiet sales period of late Spring, there was tremendous buzz surrounding the debut of GameCube.

Nintendo's long-established brand and its catalog of exclusive games made it something of a must-have item for hardcore gamers.

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