Microsoft Drops Xbox 360 Pricing

Kawahee was one of several readers to tip news of a price cut for the Xbox 360. This comes after Sony dropped PS3 prices and unveiled the Slim model last week. The 360 Elite will now retail for $299, but will no longer ship with HD cables. The 360 Pro has been reduced to $249, but Microsoft is phasing it out. Analysts don't expect this new price point to be a huge boon for sales because the Elite doesn't match the PS3's hardware capabilities and is still more expensive than the Wii. Microsoft has "no plans" for a smaller version of the 360.

Comments

MS needs to be thinking about the 720

[elrous0]

The 360 is nearing the end of the typical console lifespan (which has always been about 5 years, give or take) and is getting a bit long in the tooth anyway. A DVD drive and 4-year-old CPU are already starting to hold it back (several new games are coming out for it that will have to span across several DVD's, versus one bluray for the PS3). They really should be looking at a new generation console soon (for 2010 or, at least, 2011). If they wait too long, Sony is going to start trouncing them with the stronger hardware of the PS3.

And this time MS, for the love of God, please put some effort into making a hardware design that doesn't cause another RROD fiasco, or take a step BACKWARDS with no standard hard drive. That was just shameful.

On a personal note, how about making your online architecture a little more friendly to MMO's? The PS3 has several in the pipeline, and you don't have any. There are only so many FPS's and racing games I can put up with before I want some innovation. Backwards compatibility probably wouldn't hurt either. Just my opinion.

Re:MS needs to be thinking about the 720

[alvinrod]

I think that they're going to stick with the Xbox 360 for a while longer.

First of all, they have previously stated that they wanted to be profitable this go around. Even though Windows and Word are still a large cash cow for Microsoft, they can't afford to continue to bleed money in other divisions. They probably would reach profitability on this current generation and have started making up for the losses of the original Xbox if they hadn't run into the red ring problems. That probably set them back a year or so at least.

They're also in no real danger of being one-upped by Sony either. The PS3 may have technical superiority, but it's not by a large enough margin to cause people to move away from the Xbox 360. Sony also has a lot of costs to recoup as well and it doesn't appear as though they're in a hurry to release a new console any time soon.

It also seems as though Nintendo has begun to hit market saturation with the Wii at its current price. The sales have been down over the last few months and there's still no word of a price cut. I'm expecting one around Christmas, but they may be running out of steam. If anyone needs to come out with a new piece of hardware it's Nintendo.

If they announce a new system in the near future, sales of their current generation will probably tank. At that point Sony will be able to catch them in sales and they'll end up as the also ran of the current generation. It's likely that they're discussing hardware options for a future console at this point and possibly sharing some of that information with third parties that they'd like to keep close. It's also unlikely that they'll rush in attempt to be the first out of the door as it cost them a lot this time around.

They're also between a rock and a hard place in terms of making a decision of whether they'll move heavily towards digital distribution. They probably don't want to put a Blu-ray drive in their next machine as it increases the cost and justifies Sony's position. A DVD drive likely won't cut it for the next generation of games and the hard drives being included in consoles aren't there in terms of size yet. They'll need at least 500 GB drives if they want to move towards digital distribution and given the drives consoles are currently shipping with it will probably be another 2 years before 500 GB drives come standard. I don't foresee Microsoft using a PPC chip in their next console either which will probably kill backwards compatibility or add to the cost of the machine if they decide to support it.

They likely have plans, but I don't expect them to make any moves until either Sony or Nintendo does something first. My bet is on Nintendo just because they're flush with cash and really lagging behind in terms of hardware, especially with both Sony and Microsoft releasing motion control features in the near future.

Re:MS needs to be thinking about the 720

[Cornflake917]

On a personal note, how about making your online architecture a little more friendly to MMO's? The PS3 has several in the pipeline, and you don't have any.

Wrong.

If they wait too long, Sony is going to start trouncing them with the stronger hardware of the PS3.

Sony has had over 3 years to "trounce" them. This hasn't happened yet. Why would the stronger hardware aspect of the PS3 all of the sudden start attracting gamers away from the 360?

Re:MS needs to be thinking about the 720

[Jaysyn]

Not that I care about consoles, but if I did I still don't see myself downloading a multi-DVD game to play on one.

Re:MS needs to be thinking about the 720

[KDR_11k]

It also seems as though Nintendo has begun to hit market saturation with the Wii at its current price. The sales have been down over the last few months and there's still no word of a price cut. I'm expecting one around Christmas, but they may be running out of steam. If anyone needs to come out with a new piece of hardware it's Nintendo.

No, they just went without a killer app for too long. Their strategy does not allow for pricedrops that quickly, especially when it's known what needs to be done to restore the sales without a pricedrop (namely releasing more killer apps). Besides, they just came out with a new piece of hardware called the Motion Plus. Since they don't consider graphics and processing that important they won't release a new system just to upgrade those.

Re:MS needs to be thinking about the 720

[Anonymous Coward]

The PS3 no longer costs $200 more? It also plays Bluray movies? People already have 360s and it seems like an upgrade?

Re:MS needs to be thinking about the 720

[thule]

It also seems as though Nintendo has begun to hit market saturation with the Wii at its current price. The sales have been down over the last few months and there's still no word of a price cut. I'm expecting one around Christmas, but they may be running out of steam. If anyone needs to come out with a new piece of hardware it's Nintendo.

Nintendo is blue ocean. They are not trying to compete in the red ocean that is Xbox and PS3. MS and Sony have to price cut because they are fighting over the same pie.

The Wii is finally getting some interesting third party games. The MotionPlus is awesome and makes a huge difference in certain types of games. Less "waggle" and more precision. Nintendo really doesn't need to do anything right now. Sure, they'll have an HD console someday, but for now, the Wii is doing just fine.

A lot of people think that New Super Mario Wii is going to be HUGE (especially in Japan).

They likely have plans, but I don't expect them to make any moves until either Sony or Nintendo does something first. My bet is on Nintendo just because they're flush with cash and really lagging behind in terms of hardware, especially with both Sony and Microsoft releasing motion control features in the near future.

This is exactly why hardware performance doesn't matter. Nintendo *is* flush with cash and has moved many, many more units and they did it with lesser hardware! They weren't fighting over the current "hardcore" market. They were going after expanded market.

For the "hardcore" crowd, the PS3 is the way to go and MS could end up loosing some share to Sony.

Re:MS needs to be thinking about the 720

[not already in use]

A DVD drive and 4-year-old CPU are already starting to hold it back (several new games are coming out for it that will have to span across several DVD's, versus one bluray for the PS3).

DVD is still a perfectly capable medium for video games. If you think the increased cost of a blu-ray drive is justified by the handful of games that happen to be bigger than a single DVD, you're smoking crack.

and 4-year-old CPU... If they wait too long, Sony is going to start trouncing them with the stronger hardware of the PS3.

How do you figure? Microsoft's 4-year old processor has kept up with Sony's, wait for it.... 4 year old processor. The Cell, by the way, hasn't lived up to the hype, unless of course you like running folding@home. Otherwise, the PS3 architecture is not a good fit for game development. The reason the 360 is trouncing the PS3 is not only because of cost, but because it is far easier to develop for.

The PS3 has several in the pipeline, and you don't have any.

If by that you mean the XBox has Final Fantasy 11 and Phantasy Star Universe, and the PS3 has none, then sure, I agree with this statement wholeheartedly.

There are only so many FPS's and racing games I can put up with before I want some innovation.

Yup. This is Microsoft's fault.

Honestly... who modded this insightful??

Re:MS needs to be thinking about the 720

[gbarules2999]

The expanded market that bought a Wii, and Wii Fit, and Wii Sports Resort, and...oh. Nothing else.

You can argue until you're blue in the face about how Nintendo's going in a different direction, but I bought a Wii early on and have felt the burn everytime I walk past that useless piece of crap in the living room. It does nothing better than the Gamecube and has only garnered the same old same old only Nintendo could get away with rereleasing over and over again. While the "expanded market" has already purchased, played and probably moved on from their Wii's (I know my circle of friends have, especially the non gamers), Nintendo's busy developing and tinkering as if people still care.

Low-end HDMI Cables

[Nerdfest]

Low-end HDMI Cables are about $3 on MonoPrice.com, etc. Not a big loss, but a bit inconvenient if you don't have a couple lying around. I hope this doesn't boost sales of Monster cables.

For one

[OrangeMonkey11]

MS need to quit making gamers paid for Xbox Live; granted Sony PS3 network has its' issues but it is free to play. I never like the idea of paying full price for the game then have to pay a monthly/yearly fee to be able to play it online.

The price drop is interesting.....

[8127972]

.... When they get the reliability improved so that they don't have a 54.2% failure rate, then I might consider buying one.

what about the peripherials ripoff......

[Sobakus]

The most required price cuts are for the outrageously expensive wifi adapter and the absurdly overpriced 120 gb hard drive. I have an original xbox 360 with 20gb hard drive (only had 1 RROD, hoorray) and I can barely install 1 game, and forget about movie downloads or a couple of demos unless you uninstall that game. Right now in spain a 120gb harddrive + wifi adapter will actually cost you more than the full xbox 360 arcade pack. To all you PS3 fanbois, bless Sony for letting you put any hard drive you wish. Believe me, after years fighting with a ridiculous 20gb drive thats one hell of a feature (...insert envy emoticon here...) WTF Microsoft??!!!!

Re:what about the peripherials ripoff......

[Lectoid]

Do what I did for me and two people I know, hack a cheap 120 GB WD hard drive to work. http://www.pcworld.com/article/150970/upgrade_your_xbox_360s_hard_drive_on_the_cheap.html

This is not even really a price drop.

[Anonymous Coward]

They are phasing out the Pro model at $250 and dropping the Elite model to $300. However, once the Pro models are gone it's still going to cost you $300 to get a Xbox 360 (the Arcade model doesn't count). So, how exactly is this a price drop? I suppose you could argue that it is a value increase (as you are getting 120 GB instead of 60 GB), but I certainly wouldn't call it a price drop.

I bought a Xbox 360 Pro a year ago for $300. I've had no problems with it and enjoyed it a lot. However, if I were to do it all over again today I would go with a PS3. Back then a PS3 was $500. Today, however, for the same price as a Xbox 360 you get built-in Blu-ray, WiFi, and a standard hard drive interface. On the hardware front it's not even a contest. Xbox 360 has some great exclusive games, but so does PS3 (I hate exclusive games, but that's the world we live in). On top of that, Xbox Live is $50 a year. Xbox 360 was killing PS3 from the start (and rightly so; who pays $600 for a console?), but now the PS3 is in position to reverse that trend. Meanwhile, half of all Xbox 360s are failing. The future doesn't look so bright for the Xbox 360...

Microsoft desperately slashes Xbox 360 price

[David Gerard]

Illustration: The new accurate Xbox 360 logo

Microsoft has discounted the entry-level Doesn't-Do-Much Xbox 360 to $200 from Friday, $50 cheaper than the Nintendo Wii. (This will translate to a GBP250 price point in the UK.)

"We are thrilled to be the first next-generation console on the market with a big 'Microsoft' logo on it to reach $199, a price that invites everyone to enjoy Xbox 360," said Aaron Greenberg, marketing marketer for Xbox. He says this will cause a "smash and grab" mentality amongst consumers. "And not 'grab and smash' as they throw it out the window when it gets a red ring of death again."

The models that actually play anything worth playing will, of course, stay at $300 and $400. "But history shows that more than 75 percent of all console sales happen after the price falls below the $200 mark. Which would be the PS2, PSP and DS ... uh, forget I said that."

Greenberg assures consumers that the new cheap Xbox 360s will not be refurbished red ring of death casualties. "Not all of them. Honest. However, twenty Xbox lifts every morning will be much better exercise than Wii Fit."

Microsoft Japan is already actually paying people to take the machines, with little success. "We hope more people will be able to enjoy Xbox 360," said marketing marketer Takashi Sensui, "and we can stop enjoying quite so many of them. We also have this fine pile of HD-DVD drives ... Wait! Come back!"

Greenberg further assured consumers that "the Xbox 360 will kick the PS3's ass every way from Friday, you wait and see." Nintendo were unable to comment in time for this story as they were still too busy trying to make Wiis fast enough to keep them in the shops.