What would you rather have Microsoft do? Bring out natal with certain lacking features and then bring out those lacking features as another add on (Example, wii motion plus). Natal($100) + processor($50)= $150?

Or Natal with the processor, which would make it work the way it was meant to (not to say it won't work without the processor, I am just assuming that it would work better with it) for $150?

Forgotten to the realms of maybe but overpriced bag like the virtual boy and 3DO but it was fun before it lasted :)

The $150 price doesnt matter. The important price is the console plus Natal bundle. Remember the purpose of Natal is to increase the install base, not to sell Natals to existing customers.

As I said earlier it will be MS marketing that is on the spot here.

A typical Wii setup as sold today is about $300.
Wii $200
Wii Board $50 (about 50% of Wii purchasers get the Wii Board)
Extra Wii controller setup $50 (WiiMote+nunchuk). Not everyone picks up a 2nd controller setup day 1.

MS marketing has to sell to that. This will take some really good commercials. I really think infomercial route also needs to be done. A good quality piece of exercise software coupled with Natal and a 20 minute informercial on Oxygen, etc. will help big time.

Done.

Edge (fairly) correctly predicted the GBA SP and DSi before there was any whif of them.   This specific rumor though comes from the same source that leaked Gears 3 in April 2011 and it's public roll-out on late night television... seems pretty legit.

Thanks jarrod.

If the price is that high then I'm guessing MS is going to market heavily on Natal as a one time buy vs multiple controllers over time plus push the experience as worth the investment (i.e. they surely must market to imply Natal is better than Wii and the next big thing).

It's a fair approach, but a risky one.  Sony tried marketing PS3 as cheaper if you took that view and counted cost of getting 360 and BR player, etc. but the average consumer tends to focus on initial cost vs overall cost - i.e. the cost of getting going with one controller is what they'll focus on and compare that to Natal.  While down YOY the Wii is still attracting more purchases than the 360 or PS3 WW so it's far from given that we'll see a big divergence of interest from Wii to Natal.  Although MS might well be eyeing the recent YOY Wii performance and thinking it might indicate tailing off of interest and a chance to re-focus attention on Natal.

Of course the rumour could still be off, or MS might change their minds closer to release if they sense they need to.

WHEW I hope that is not true!

my hype meter for Natal just dropped by 1/2...

My guess is that there will be one Natal game in the Arcade/Natal bundle and no more.  But to be honest, we are both guessing. 

Also, there is an extra controller set-ups for each. For the Xbox 360, its $30 for a third-party wired to $50 for a first-party wireless to $65 for a controller/charger bundle. For the Wii, you can spend $40 (Wii Remote) and two $20 add-ons (Nunchuck and WM+ ---  though rumors are the latter will be integrated into the controller soon). The Xbox 360 also requires an add-on ($80-$100) to receive wireless communications and additional storage costs more.  So it depends on what you buy how "outlandishly" expensive either system becomes. 

Finally, Microsoft must be careful not to make direct comparisons with Nintendo ... because it will not have a lot of motion software this holiday season to offer. In other words, other comparisons may not favor Microsoft.

Mike from Morgantown

ty, on my ps3 browser i struggled to read pages with your sig on them, even on the pc browser it was slow, the gifs were ace mind you, just need to be smaller file size.

One possible reason for the high initial price that occured to me is that NATAL is going to be heavily supply constrained at launch. At the $99 price, MS would probably move ~10-12 million NATALs during the christmas quarter. At $150 that will be closer to 5-7 million.