Elite Won't Replace Premium or Core Skus

As the day has progressed, more information about the 'Elite' has become available. GamesIndustry.biz is reporting that the other two 360 skus will still be available. The Elite is not replacing either of them. Interestingly, there's no word on a price drop for them either. Major Nelson's most recent podcast has several interviews and details about the new offering, which you may find informative. There's more analysis available, if you find that interesting: CVG wonders aloud who is going to buy this thing, while a Wedbush Morgan analyst mentioned to GamesIndustry.biz that he thinks this validates the PS3 strategy. "'It appears to me that Microsoft sees the writing on the wall - Blu-ray is going to win the format wars ... Ultimately, Microsoft will likely offer a Blu-ray drive with the 360 Elite, and I think consumers will be able to select based solely upon other drivers.' Pachter also believes that although the Xbox 360 Elite will register with early adopters of hi-def content, the current 20GB model will still be sufficient for many consumers."

Comments

What the fuck is with SKU? It's a product.

[Anonymous Coward]

Is everyone suddenly a merchandiser or something? I'll replace your sku.

Blu-Ray

[*weasel]

It appears to me that Microsoft sees the writing on the wall - Blu-ray is going to win the format wars

It appears to me that Microsoft is acknowledging the format wars are stillborn. Their support for HD-DVD was just about defusing the PS3 anyway, not defeating Blu-Ray. MS already has their license fees secured, regardless of how the little-plastic disc formats fare.

The media victory Microsoft is after, is digital delivery.

Prices

[Applekid]

Prices are funny. Microsoft is obviously milking every dime they can get out of gamers who buy a system before they drop the prices. While there is no sign of that happening, you can pretty much count on any PS3 price drop to be matched by a 360 price drop of equal or greater value.

That "validation" of the PS3 strategy by way of price is a bit misleading, though. Sony equates the PS3 to fine equipment whose price indicates its value. But it's a genuinely expensive device to make. What the PS3 price points have proven to the people who figure out the prices of consoles is that consoles have been too cheap and the market could sustain them at higher prices than previously thought.

Other very expensive consoles have gone down in flames for home use... but the median price for the majority of consoles at the market at any given time has been a $200 - $250 sweet spot. The only thing that Microsoft and Sony have done is show that the sweet spot can be coaxed higher.

What I don't understand is why Microsoft isn't playing a price war yet. They've got the biggest userbase for this generation, most established games (excluding Wii's ability to play Gamecube games), and they're turning a profit on current consoles sold. Sony's machine costs $800 and putting pressure on them to lower a price point could hasten any future demise... if it's in the cards.

My only stab at trying to understand is that Microsoft eventually wants to buy the Sony gaming division, but I'll be the first to suggest that's an outrageous claim. Hmmm...