Xbox Prices Fall in Japan as Microsoft Struggles to Play Catch-up

The Xbox is set to cost lesser in Japan, according to a release by Microsoft. Microsoft said the move to slash the price of its gaming console, the Xbox 360, was part of a new strategic initiative that would help them compete better with rivals Sony and Nintendo. Microsoft has been struggling to sell more pieces of the Xbox 360 in Japan in comparison to Sony’s PlayStation 3 and Nintendo’s Wii.

Microsoft said it would reduce the price of the Xbox 360 by 13 percent. One look at the comparative sales numbers of the three rivals tells you why. Enterbrain, the publisher of Famitsu, said Nintendo had sold 1.8 million pieces of Wii in Japan in the first half of 2007, while Sony had managed to sell 503,544 pieces of its PlayStation 3. Compared to this, Microsoft had sold just 122,565 pieces of the Xbox 360.

As one can see, the above numbers indicate that Nintendo is way ahead of its rivals when it comes to sales of gaming consoles in Japan. Nintendo’s domination of the gaming console market is not limited to just Japan alone. It has dominated sales in markets across the globe.

Nintendo, which introduced the Wii last year, has so far shipped 9.3 million pieces of the gaming console. Sony, on the other hand has sold 5 million pieces of its PS3. The PS3 also hit the markets for the first time in 2006. Microsoft has shipped 11.6 million pieces of the Xbox so far. While that number is higher than that of the Wii and the PS3, the Xbox 360 went on sale a year ahead of the other two.

Sony fired the first reduction salvo earlier this month, when it announced a 10 percent downward revision in PlayStation 3 prices and also the launch of a cheaper model by November 11. Sony had also announced a price reduction for its PS3 in the US market, and had already launched a cheaper model there.

The decision to slash Xbox 360 prices is in direct response to Sony’s price reduction initiative. The Xbox 360 would now cost 34,800 yen in Japan, and this new pricing would be effective November 1. The basic Xbox model, which was earlier available for 29,000 yen, would now be sold for 27,800 yen, a release by Microsoft Corp. said.

With the Christmas season round the corner, the world will definitely see another price war unleashed as the three rivals go all out to ensure they sell the most pieces of gaming consoles.