Why I believe Sony have to drop this price this year.

[goddog]

dbot said:

The economy will have the same impact on all 3 console manufacturers.  Nintendo is in the best position because they have tremendous sales at an attractive price point and they make money on each sale.  Both MS and Sony lose money on each unit sale and hope to make it up on software sales. 

In this economy it is best to focus on profitability and revenue.  MS needs to sell substantially more units to achieve the revenue that they were earning prior to the price cuts.  Using the Arcade as an example, to achieve 30 million in revenue the arcade can sell 107k at the "original" clearance price of $279 per unit, but at the new price they need to move 150k units to achieve the same revenue of 30 million.  MS needs to sell 43k more units just to have the same revenue.  I am not sure MS would have cut the price had they known how bad the economy would be.

 

i think they still would have, and do you have any information showing that they are taking a loss on each console the said this summer they werent and with another chip revision and time prices could be easly down to under the cut, sony is the only one who has said they wont be making a profit until next year january o9. further, ms is a planned cut, and profits are what matter, so if ms is say losing money on the arcade and making very little on the pro and a good bit on the elite, people buying excesories like storage units or controlers, make up the difrence in low end, and games are pure bonus.

however we will never truely know how the xbox and its products are doing, due to ms putting it in with zunes and surface and other experimental units. so the division may loses money anyway or make money without the xboxs help. only ms knows.... now share holders could demaned that info if we have any share holders here they should send in a request, and see what happens