Price cut - When/How Much

[mkozlows]

catofellow said: I am going to guess that we will se a price cut for all three units in May.

I guarantee you're wrong. There's no way the PS3 will get a price cut this soon after launch, not when Sony is already taking such a large hit on the units. It'd be seen (correctly) as a desperate move.

The XBOX 360 is hardest to predict. We know they probably are going to redesign the console, but how many SKU's are they going to keep? I am predicting that they will cancel the "core" bundle (if they haven't already, it appears to be "sold out" everywhere).

No, the Core bundle is critical for Microsoft as they cheapen up. One of the (many) difficulties they had in cost-reducing the original Xbox was the hard drive. What they discovered is that if you're buying a small hard drive to start with (which they were in both generations), your drive costs will never go down. Over time, you'll get larger drives for the same price, sure, but you won't be able to get a drive of any size for less than you were initially paying. This makes it awfully hard to sell a $129/$99 console at anything other than a loss. Microsoft knows that they're going to eventually be selling a console for cheap, and that in order to do that they're going to need a unit without a hard drive. That's why they created the Core console in the first place. At this point, with the 360 selling largely to consumers who don't mind spending $300-$400 for a game machine, the value SKU isn't quite as important; when it comes down to $129 vs. $199, it will be essential. If/when Microsoft comes out with an HDMI-enabled 360, it will certainly replace the existing Premium, and will probably appear on both Premium and Core units (because I doubt the added cost of the HDMI port would exceed the added cost of now having to manufacture two different pieces of circuitry, which they haven't previously had to do).

Wii - 200 as is (250 dollar DVD unit released in September).

It's hard to imagine Nintendo cutting prices on a unit that's selling so well and getting so much press. On the other hand, the Wii manifestly isn't up to the specs of the 360 or PS3 (I die a little on the inside every time I load up Zelda and partake of the Festival of Jaggies), and its value proposition really does depend on being the cheapest console. It's hard to imagine the Wii being successful if it costs more than the 360. But I suspect that, at the very least, Nintendo would give it a month or two to see how that played out, and then react if things dropped off a cliff for them.