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7As can be seen on EBGames, the price for the Xbox is now $199 as several people had expected. A big $100 drop just like Sony announced for the Playstation 2 earlier today, something which will hurt Microsoft more as the Xbox costs more to make. The GameCube, PS2 and Xbox all retail for the same price now. Thanks Portax and Luminair.
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MS will more than make up for the cost of the ubercheap X Boxes in sales of software, their revenue is generally about 5 billion, and they seem to usually have about 2 billion in profit, so even if they sell 5 million X boxes at a $200 loss, they'll still be up a billion at the end of the year. I'm sure they're not happy about this, but it's not like they can't afford it.
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For Uncle Bill, he doesn't have too many games, and already the XBox costs more to manufacture than others.
When you drop the XBox price by $100.00, you have to sell two more games for each console, in order to get back to where you were (which was already losing money).
So in order to break even on an XBox sale, Microsoft is probably having to sell about four games per console. At this point, with the games available, this is probably not going to happen.
When I bought my XBox, the slam dunk of course was Halo. I had to scour to find a second game interesting enough to buy... bought DOA3 and it sucked. After Halo, I sold my XBox. Bloodwake looks cool, but I hear it's not very good, and other than that I haven't seen an XBox game that makes me regret my decision.
Sony on the other hand, with 30 million consoles out or whatever, can afford to cut the price, as they're probably close to saturation at the current price point, and this isn't going to hurt them that much.
Really, if I were running the show at Microsoft, with my head XBox guy quitting and starting a company saying that the current game offerings for XBox suck, and having to chop prices with my expensive components... I'd be losing some sleep.
While Microsoft has stuck around before for the long haul, they've also exited arenas in which they could not compete very well after a year. If this thing looks like it's only going to burn money, they will definitely exit.
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from a ms press release today:
"The Doumen facility will enable Flextronics to manufacture Xbox consoles under ideal production circumstances," said Todd Holmdahl, general manager of Xbox Hardware at Microsoft. "It is a large facility with a strong infrastructure and flexible production capacity that will result in significant cost efficiencies."
http://investor.cnet.com/investor/news/newsitem/0-9900-1028-9900210-0.html?tag=ltnc
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I remembered why I sold mine.
The Xbox *deserves* to do well.
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I'll be gettin' one!
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Furthering the monopoly idea, the X-Box isn't just a console for them. They want to move out of the den or computer room and move into the living rooms (of America especially). They want people to see "Microsoft" on their TVs as well their computer monitors. THAT's why they're lowering prices. At the risk of sounding cliche, you have to spend money to make money. The console war is a long-term thing for them, and this system isn't much older than six months.
Give it a year. Maybe then I won't have a need to play my PS2 anymore. ;)
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Now some might say Nintendo is in trouble. Nope. I think they are doing very well with the GameCube. It's doing well in Japan, Europe and the US. Why is it not selling that many units? Nintendo having a hard time keeping up with demand, plus the fact that the X-Box and PS2 are more Entertainment Devices than Stand Alone Game Players. I actually own both a Cube and PS2. They are both great machines. I can play games on the PS2 that aren't out for the Cube and Vice Versa. Only thing is that I actually have 6 games for the Cube and 4 for the PS2. Why. Well, most of them are exclusives except for Madden for the GameCube, but that was when the system was launched.
The current system war has the PS2 in the lead with GameCube following behind with the X-Box in third. So Microsoft really needs to move units.
I would get an X-Box if it hadn't been for Microsoft's track. I keep hearing that there are people with X-Box's failing. In fact, Kyle from HardOCP keeps complaining about his from time to time.
Anyway's,
PEACE
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prime.d2g.com/p/consolepricing.jpg
Divide by almost exactly ten to get American dollars.
/ V
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i hate waiting for a payoff...
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I'm impressed that MS is dropping the price by $100 after only six months on the market, an UNPRECEDENTED move in VG history. PS2 is was two years old in March (remember it was released 6 months before reaching the US). It shows a lot of commitment on MS's part to do what it takes (ie - lose the necessary money) to keep sales strong through the slow summer months and keep moving units.
Now they just need to follow suit in Japan, and drop the UK/Europe price another 50 pounds at the end of the summer.
Now for the "not a fanboy" caveat: I own a Dreamcast, PS2, Xbox, Gamecube, and GBA. I love the idea of each of them thriving and each providing me with great game experiences tailored for that system.
I don't care who started this console fight, who forced who's hand on the price, or what. I'm just glad that the fight is getting so ugly so fast - good for gamers!
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I LOVE THIS COMPANY
YEAH!!!!!!!!!!!!wOOOOO!!!!!
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It's the best system! :)
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