Why the Scorpio will sell for no more than $399 (if its 6tflops).

[Machiavellian]

Drakrami said:

Fei-Hung said:

I don't think they can that easily try to match price without taking a bit. You have to remember MS have very likely signed a contract with AMD to buy a certain processor and GPU that they can't back out from unless they are willing to pay a penalty.

 

They have already stated clearly what the bandwidth will be which they can't go back on either meaning there is no cost saving to be made there. 

 

The only way MS can compete on price will be through incurring heavy losses which isn't something they will be willing to do. 

 

They have been very clear when stating the Scorpio will be a premium system with a premium price tag. 

Finally, some common sense on the internet. Scorpio is probably MS's last comeback strategy to win back market share. If they failed, they aren't going to focus on the console market anymore. You can always see it in the cards... with the investment they make in gaming developments, they have already streamlined their investment a lot. There has always been rumors that Microsoft wants to drop the console. And Microsoft even openly says Scorpio is the last console generation. 

So they are put in an extremely awkward position with the PS4Pro, at this price point, and this early release date. 

Satya is not going to greenlight Scorpio incurring big losses per console when they are already in such a weak marketshare position. 

Actually there have been rumors that investors wanted MS to drop or spin off the console.  I cannot remember any rumors on MS themselves going down this line.  Do not forget that Satya is looking to make MS a tools and service company.  The Xbox brand is still one of their best devices to deliver the service part.  With that, investment on strengthening the Xbox brand is in their best interest.