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Microsoft Readies Cheaper 360
Officially Microsoft is putting on a brave face, saying they won't drop the 360's price even in the console's weakest market: Japan. Just the same (probably in anticipation of Sony's PS3 price drop), the San Jose Mercury news says the company is secretly working on preparing a lower cost Xbox 360 SKU. Called 'Falcon', it's a cost-reduced system using 65nm chips instead of the at-launch 90nm electronics. This ties right into Michael Pachter's expectation of such a cut; it should be noted he doesn't see the DS or Wii prices moving any time soon. Related to all of this, Newsweek's LevelUp blog has two great interviews today: a Peter Moore discussion harkening back to last week's warranty announcement, and a chat with Jack Tretton about the price cut and the 360's hardware issues.
I got my 360 Premium brand new from Micro Center for $300 almost a year ago. Since then that sale's been running on and off non-stop. How is $250 half the price? It's $50 less... and for a console with fewer games and pricer controllers (I'd need the nunchucks) I don't see it as that big a bargain. I'm not saying a price cut is in order by any means, but I never saw the Wii's somewhat lower price a huge selling point for myself (though then again most people look at $9.99 and think it's much cheaper than $10.00).
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I believe Microsoft took the $1B that the new warranty program will cost and applied it to fiscal year 2007. So, 2007 is an extra billion dollars in the hole, but since they don't have that baggage hanging on them in 2008, it's still possible that they might turn a profit in 2008.
To say the same thing in a more cynical way, if you play with the numbers enough, you can make whatever year you like profitable.
As someone who has a 52"HD TV and has both the GameCube and the Wii, I can assure everyone that the Wii's graphics are better than the GC. The Wii provides a very clean 480p signal from it's component output. I have GC games that turn on more effects when played on the Wii, so Gamecube games actually may look and run even better on the Wii. Nintendo's current hardware is very compact, quiet, and uses little energy, unlike other consoles I own. I find the graphics a Wii or a GC produce are far from "terrible", and often are more pleasant than the graphics produced by higher resolution systems, especially PC's.
From what I've seen, HOME is a bloated way to hook people up online. I like the streamlined 360 online features. I don't want to have an Avatar walk around meeting other Avatars. It's pointless. I AM the Avatar. Just cut out the middle man and let communicate directly with people. And I don't want to walk my Avatar down to the shop to shop for something. Just show me a menu. That's why I shop from home for things. Web sites make it easy to find stuff in a 2D list. I hate going to a store to look for stuff. I'll hate it even more having to go to take my little Avatar to a virtual store and look for stuff there, too.
Well, I do recall that the PS1 was specifically priced $100 less than the Sega Saturn, and that the price was announced specifically to screw Sega.
Wouldn't surprise me if they had to drop the price early to follow a desperate Sega drop...
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