How much/when will Microsoft drop the price of the 360?

[Lord N]

madskillz said:

Lord N said:

I would be surprised if MS drops the price at all before Christmas. They waited two years to drop it by a lousy $50, so I don't see why they'd do it again so soon.

A $100 price cut would have been effective right before the PS3 and Wii launched, and they should have done another to $250 right before last holiday season.

As it stands right now, the 360 already has a 7 million lead over the PS3. A price cut probably wouldn't increase it by more than 1million, and MS would still have the Wii to worry about. That being said, such a cut wouldn't hurt Sony all that much, wouldn't improve their standing in the market as they'd still be a distant second behind the Wii, and would insure that MS is stil sitting on billions of dollars of red ink at the end of the generation as the hardware would be sold at a loss. Not to mention, it would look like desperation/uncertainty.

They dropped the price to generate more sales. And yeah, folks took notice.

And most companies won't do a price cut unless - they are trying to generate sales. MS had absolutely no need until the release of several big guns, to create momentum. And by looking at the NPD numbers and such, it did just that.

How would a price cut not hurt Sony? That's less sales for Sony, more for MS and an even bigger lead. And last quarter, MS had a PROFIT in the division. Folks are confusing the Xbox with the 360. The 360 is blowing the Xbox out of the water completely. MS is making money and can afford to be bullish against the PS3. And based on the lead, which has been growing over the past year, MS isn't desparate. They aren't the kind of folks that would drop their cargo at the first sign of imperial forces. They are in it for the long haul. Sony, on the other hand, is losing tons of money - look at the last quarter financial reports and going for penetrations in hopes of scoring royalties on the Blu Ray movies and such.

 

The 360 is not "blowing the Xbox out of the water completely." It's a mere 3 million ahead of where the Xbox was at this point in it's life time, which is pretty negligible. It would be like adding a few million more onto the total sales of the N64 or Xbox. They would both still be in a distant second place, which is exactly where the Xbox will be at the end of the generation, and that's a best-case scenario.

 

The 360 already had a price cut last year RIGHT BEFORE the launch of Halo 3, which is by far their biggest franchise, and it managed to extend the lead over the PS3 by......1 million units. That being said, I don't see how the effect is going to be any greater if they do the same thing for a multi-platform game. Plus, we've already seen that Europeans prefer the more expensive PS3, and Japan is a no-go no matter what they do, so it's obvious that price isn't the only place MS needs work.

 

Both companies are losing tons of money due to their flawed business models. MS is already more than 6 billion in debt.