After year-long speculation that Microsoft is planning to cut Xbox 360 prices, the software giant on Friday gave the hints that its most powerful video game and entertainment system, Xbox 360 will soon see a price drop, apparently realizing the fact that consumers react well to lower cost consoles.
In an interview with Bloomberg Microsoft's David Hufford, a director of Xbox product management admitted that USD 199 price point is the "sweet spot". “We are well aware that the sweet spot of the market is really 199 bucks,” Hufford said in the interview.
As the world's largest software maker recently has committed to add more family-orientated games, Hufford thinks US$199 is the ideal price for the family audience.
With its plans to cut the price of Xbox 360 and add more family titles, Microsoft apparently is trying to follow its rival Nintendo’s success in the gaming industry.
Among the trio of next generation gaming consoles, Nintendo has emerged as the numero uno in April for the fourth consecutive month after selling 360,000 of the popular video game devices in the United States, repeatedly outshining both its rivals Microsoft’s Xbox 360 and Sony’s PlayStation 3 in the US video game consoles market.
The more-powerful systems, Sony’s PlayStation 3 and Microsoft’s Xbox 360, in April, again lagged behind in the fierce battle for dominance in the booming gaming consoles market by moving 82,000 and 174,000 units, respectively.
Launched in November last year, Nintendo’s Wii console retails for $US250, while PS2 costs only $129. The PS3 and Xbox 360 start at $499 and $299 , respectively, while their high-end versions are priced at $US599 and $US399(Xbox 360 Premium System) and $US479 (Xbox 360 Elite System), respectively.
During his discussion with Bloomberg, Hufford confessed that besides the youngsters Nintendo Wii has drawn an audience that wouldn't normally play games, such as soccer moms, and the elderly.
Making a remark on Nintendo’s low-cost gaming device, Hufford said "When Mom walks into the store and sees she can get a console with a game for USD 250, she sees it as a USD 300 value. They've done a good job".
Impressed with the way Nintendo has attracted the women, children and the elderly, Microsoft now intends to adopt the Japanese company’s marketing strategy to win a broader audience than the first Xbox attracted. The Redmond giant hopes this move will help it shake off its ‘hardcore’ image that hampered sales of its sixth generation era video game console, the original Xbox, which was first released on November 15, 2001 in North America.
"If we don't make that move, make it early and expand our demographic, we will wind up in the same place as with Xbox 1, a solid business with 25 million people," said Peter Moore, Microsoft's Head of Interactive Development.
"What I need is a solid business with 90 million people."
Although, Microsoft has not yet clearly confirmed price cut for the console, but Heather Bellini, analyst for the Institutional Investor, foretells that a price reduction may happen as soon as September.
"If they really are going to have a good Christmas games line-up, then they just have to have the largest number of boxes out there so that they sell the largest number of games”, commented Bellini.
Earlier this month, Microsoft has added Blinky, Clyde and other Pac-Man hallmarks to its Xbox 360 game consoles. Microsoft, which has always tried to hook more and more customers, now has made Pac-man, the legendary game, its weapon to boost the sales of Xbox 360.
In March, Microsoft Game Studios and Bungie Studios revealed the first details of the three editions, “Standard”, “Limited” and “Legendry”, of the most-eagerly anticipated Xbox 360 game, "Halo 3", which will hit stores later this fall, also giving gaming enthusiasts three different purchase options.
Announcing the three different SKUs of Halo 3, the companies have divided the gaming community in three kinds: First, those who are really, truly desperate for Halo 3, then those who are sort of desperate, and lastly those who are just your garden-variety desperate.
The companies said that the three different editions are adapted for the tastes of all kinds of gamers.
Submitted by JahMekYa (not verified) on Mon, 06/11/2007 - 10:28. *
I agree with bt0164 that cost is not the only issue. However, it does account for a significant portion of why things are the way they are in terms of who is outselling who. I personally opted NOT to buy any of the three consoles, opting for the portable PSP. That was a personal decision, not only because I am getting older, and have less time to devote to playing video games, but also because I like the idea that I can have my recreation wherever and whenever I wish/need. That might be eventually where gaming will go. After all, computing has already gone that way, with the laptop/notebook. It may only be a matter of time. What will set that off is communication between the different devices (PSP communicating with Nintendo DS Lite, etc.)
Submitted by Anonymous133 (not verified) on Mon, 06/11/2007 - 04:08. *
Well I'm glad Microsoft is finally realizing this. It took them quite a while to learn how the Wii was so successful. What happened to R&D? Well my point is the price is a major factor of why I didn't buy an Xbox 360 or PS3. But ultimately I think you go overboard when you pump tons and tons of features that most people might not use. It's good to have that if you want it but if you don't then you won't want to pay the higher price for it. Image a PS3 Lite without the blu-ray player and other junk? $299 or less would be a pretty solid deal I would think for the power of the PS3. Plus the family games makes a big difference. Targeting not only hardcore gamers but those families that like to have 4 controllers busting out mario party certainly catches attention to moms and dads.
Submitted by none (not verified) on Mon, 06/11/2007 - 02:43. *
Don't be fooled because something cost less. PS3 is the best of the 3 consoles which is why it costs what it does. Sure you can be glad that you paid less for something but when you get home and realize how limited the Wii is then you will feel ripped off.
Submitted by Sean (not verified) on Sun, 06/10/2007 - 16:19. *
Price is huge thing. In fact, the only reason I don't have an xbox 360 currently is because I can't shell out that kind of money. Lowering, the price puts the system a little more in my price range; and if it does this for me, I'm sure it does this for others as well. I'm glad Microsoft is recognizing this.
Regarding family games, I'm all for it. Don't get me wrong. I'm a big halo junkie, but I always have little kids at my place. Has anybody actually tried to teach an 8-year-old to play Halo? One word -- Don't. Its like trying to teach someone brain surgury over the phone - doesn't happen. Ask a elementary student what he would rather have, a Wii or Xbox 360. I'll bet my bottom dollar the Wii wins every time. Making games for the family makes the system more rounded which is one of the big reasons Nintendo Wii's sell like hotcakes (other than price). Its great that Microsoft see's this.
Submitted by Rod Avery (not verified) on Sat, 06/09/2007 - 23:28. *
They see it as a price thing because it is a price thing. If you could pick between two things that both do the same, would you pick the more expensive one? I didn't think so. I know 360 and Wii do not do the exact same thing but they both play games; 360 has great graphics and the Wii has an innovative control scheme. Look at the PS2. It is still the #1 selling console because it costs so little. Microsoft will sell more 360's with this gamble.
Submitted by Josh426 (not verified) on Sat, 06/09/2007 - 20:45. *
Microsoft should try to convince the software makers to drop their prices all without dropping the quality. A 400.00 system will sell much better with games only costing 25.00 or 30.00 rather then 50.00 and 60.00.
Submitted by Anonymous123 (not verified) on Sat, 06/09/2007 - 20:41. *
This guy helped again. We have seen him at some very important banking and finance meetings. I bet he is advising the big guys on a way out of this mess. He has been known to come up with a solution to many problems very quickly !
Submitted by Bill (not verified) on Sat, 06/09/2007 - 20:03. *
It may not be cost for some, but with a price tag of 600usd (I haven't even seen one of the low-end ps3's around here yet) is prohibitive for a great many people. That's an entire 2 week paycheck for a person making 9.50usd per hour working close to full-time. Myself, Sony erred with the inclusion of the Blu-Ray, which, as many are saying, may fizzle out ala Betamax. Additionaly, the Blu-Ray (a player for which is 400usd standalone) has to be a significant chuck of the unit cost for a ps3. Leaving it out would have lowered the price point significantly and increased unit sales, meaning more boxes in homes for the game-buying madness that is the Christmas season.
Submitted by bt0164 (not verified) on Sat, 06/09/2007 - 15:03. *
Again, they're seeing this as a price thing.
It's more than price. It is the easiness factor. Xbox360 can cost $199, but it will still not sell as much as the Wii does. Apparently software and cost are not the only factors that make the Wii so successful.
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The real issue is...
I agree with bt0164 that cost is not the only issue. However, it does account for a significant portion of why things are the way they are in terms of who is outselling who. I personally opted NOT to buy any of the three consoles, opting for the portable PSP. That was a personal decision, not only because I am getting older, and have less time to devote to playing video games, but also because I like the idea that I can have my recreation wherever and whenever I wish/need. That might be eventually where gaming will go. After all, computing has already gone that way, with the laptop/notebook. It may only be a matter of time. What will set that off is communication between the different devices (PSP communicating with Nintendo DS Lite, etc.)
We shall see.
Well I'm glad Microsoft is
Well I'm glad Microsoft is finally realizing this. It took them quite a while to learn how the Wii was so successful. What happened to R&D? Well my point is the price is a major factor of why I didn't buy an Xbox 360 or PS3. But ultimately I think you go overboard when you pump tons and tons of features that most people might not use. It's good to have that if you want it but if you don't then you won't want to pay the higher price for it. Image a PS3 Lite without the blu-ray player and other junk? $299 or less would be a pretty solid deal I would think for the power of the PS3. Plus the family games makes a big difference. Targeting not only hardcore gamers but those families that like to have 4 controllers busting out mario party certainly catches attention to moms and dads.
Don't be fooled because
Don't be fooled because something cost less. PS3 is the best of the 3 consoles which is why it costs what it does. Sure you can be glad that you paid less for something but when you get home and realize how limited the Wii is then you will feel ripped off.
Price is huge thing. In
Price is huge thing. In fact, the only reason I don't have an xbox 360 currently is because I can't shell out that kind of money. Lowering, the price puts the system a little more in my price range; and if it does this for me, I'm sure it does this for others as well. I'm glad Microsoft is recognizing this.
Regarding family games, I'm all for it. Don't get me wrong. I'm a big halo junkie, but I always have little kids at my place. Has anybody actually tried to teach an 8-year-old to play Halo? One word -- Don't. Its like trying to teach someone brain surgury over the phone - doesn't happen. Ask a elementary student what he would rather have, a Wii or Xbox 360. I'll bet my bottom dollar the Wii wins every time. Making games for the family makes the system more rounded which is one of the big reasons Nintendo Wii's sell like hotcakes (other than price). Its great that Microsoft see's this.
Hope to see changes implemented soon.
Your welcome
for the pricing corrections I provided this morning.
:)
Because It Is
They see it as a price thing because it is a price thing. If you could pick between two things that both do the same, would you pick the more expensive one? I didn't think so. I know 360 and Wii do not do the exact same thing but they both play games; 360 has great graphics and the Wii has an innovative control scheme. Look at the PS2. It is still the #1 selling console because it costs so little. Microsoft will sell more 360's with this gamble.
Halo. Meh. What's so special
Halo. Meh. What's so special about it again?
Drop Game Prices
Microsoft should try to convince the software makers to drop their prices all without dropping the quality. A 400.00 system will sell much better with games only costing 25.00 or 30.00 rather then 50.00 and 60.00.
Eric J. Herrholz
This guy helped again. We have seen him at some very important banking and finance meetings. I bet he is advising the big guys on a way out of this mess. He has been known to come up with a solution to many problems very quickly !
Not a price issue?
It may not be cost for some, but with a price tag of 600usd (I haven't even seen one of the low-end ps3's around here yet) is prohibitive for a great many people. That's an entire 2 week paycheck for a person making 9.50usd per hour working close to full-time. Myself, Sony erred with the inclusion of the Blu-Ray, which, as many are saying, may fizzle out ala Betamax. Additionaly, the Blu-Ray (a player for which is 400usd standalone) has to be a significant chuck of the unit cost for a ps3. Leaving it out would have lowered the price point significantly and increased unit sales, meaning more boxes in homes for the game-buying madness that is the Christmas season.
Again, they're seeing this
Again, they're seeing this as a price thing.
It's more than price. It is the easiness factor. Xbox360 can cost $199, but it will still not sell as much as the Wii does. Apparently software and cost are not the only factors that make the Wii so successful.
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