They might have DDR3 RAM to make it cheaper, but they also have ESRAM which is an expense Sony doesn't have. so the RAM costs probably are more even than people think. And there's probably nothing much else in it.

I dunno why people keep on that PS4 library is lacking. As far as metacritic is concerned PS4 has a better over all library than Xb one: 30 games in the "green zone" for PS4 vs. 16 games in the "green zone" for Xb one. So on the game library front you can't really say current value is with Xb one.

Price will only really help Xb one in North America and UK. I mean sure in every market a price cut will increase sales, but it will only do so to any significant extent in NA and UK. Everywhere else the price will be the same as PS4 but people will still prefer PS4 by a very large margin.

MS has to ask itself: Do we cut our income for only a modest global increase in sales? We are reasonably competing in our key markets (NA, UK) and building a decent user base (temporary price cut and all) should we not keep the revenue coming, build value and let those minor markets coast along until we can cut price and remain break even at least.

They obviously see the writing on the wall for almost all markets (or at least all important markets - i.e. the current 13), other than NA and UK, and know that they will sell closer to Wii U than PS4 in those 11 markets. Kill kill off revenue for no real gain in sales.

Here in New Zealand we still have differences in retailer pricing. Some retailers have put the base price (and TF bundle) back up to the launch price, other retailers have all skus (other than multi-game skus) at $50 less than launch price (but still $50 more than PS4) . MS does need to get its global pricing settled, and I think maybe they will settle it at $450 US and with a similar adjustment in all other markets. I don't think they'll go for a $100 price cut this soon. They will have more extra special deals around the holidays though, so you could probably expect to pick up an Xb one in the holidays for even $150 less than the launch price, or at a higher price with 4 or 5 games thrown in.

I don't think they can lower the price without stockholders calling for a spinning off of the division.

It's hard to guess at what point console hardware is profitable or loss making but the companies themselves are never going to give true information on the cost of manufacturing. They want consumers to perceive the consoles are good value. Clearly though consoles are much simpler in components than PC's for example and are manufactured on a far higher volume with economies of scale. The big issue with consoles is the R&D costs which have to be factored in. The cost of manufacturing in China has increased though.

I know I won't be buying a Xbox one for a long time. When I buy i will be to play exclusive xbox one games with single player campaigns. Microsoft doesn't seem interested in me as a consumer so really I will wait until the console is much cheaper and I'll still need about half a dozen games to justify purchase. As a package it has to be a lot less than ps4 in pricing for me.

Clearly in mainland Europe the xbox one needs a serious price cut. It doesn't even have a foothold currently there. Here in the UK its better. Microsoft need to focus some attention on the rest of the world. It's doing good in the USA but surely they don't want the xbox one to be seen as a console for the USA only.

Nintendo's wii u doesn't need to be a powerhouse to run Nintendo software which have low performance requirements from the hardware as normally fairly simple games with cartoon graphics however Microsoft is not like that. The original xbox was hugely powerful for its day with a large advantage over competing consoles at the time. The 360 beat the ps3 for most multi-platform games and was very powerful but this new generation the xbox one is at a low performance level yet previously xbox was always about great performance. Lower than ps4 and even entry level gaming PC's. So you have a console with low performance at quite a high price, expensive games that don't perform that well technically and much functionality of the console behind a pay-wall. You don't even have backwards compatibility to extend the available software it can use. It's not a great package to say the least.

Microsoft desperately need a lower price in mainland Europe to stay in the race. A price that may be low compared to the USA but without it they risk losing Europe entirely with Europe ending up like Japan with regard the xbox brand. I.e. a niche console on the fringe of gaming like the wii u has become.

In my honest opinion, I think Microsoft won't make a cut just yet. They want to force people to buy the console at $499 so they'll rely on wowing the crowd at E3 with their flagship exclusives and 3rd party exclusives. They can't afford a price cut right now, not this early. Also, a Kinect-less SKU is unlikely. The UI was built around the Kinect and while it's not 100% perfect, it still works. Besides, they need to profit on it.

Would it make sense if they unbundle the Kinect 5 months after the release of the Xbox One?

- I doubt that E3 will feature a price cut. We have just seen the announcement of "TV Originals", and my opinion is that MS is continuing with their original message: "Value". They have repeated many times that XO's value justifies the price, and it seems that they are more willing to spend money on content, than to "spend money" on price reductions.

- Outside TV programming, in order to remain competitive, MS really needs to show its potential customers some new, interesting, powerhouse games to draw them in.

- I believe MS has learned a lot from March and the Titanfall "loss". They have learned that Titanfall was indeed a system seller, but unfortunately it sold systems in the months preceding the actual game. MS's two biggest IPs and system-sellers are Halo and Gears. However, relying on those games to conjure up sales is probably pointless. It is "preaching to the converted", Majority of people who are interested in those 2 (3 including TF) franchises have either already bought the console, or will do so in the upcoming months.

- Those new IPs are certainly not "Sunset Overdrive", which I believe will have a strong and dedicated fan-base, but I cannot imagine its appeal to a broader audience, and I cannot imagine it being a system-selling game.
- I have serious doubts about "Quantum Break". So far, all that we could see was some fantastic graphics and Remedy's trademark bullet-time. I believe that this game has a huge potential, but that it will get bogged down due to TV -show integration, that it will lose a great deal of its appeal due to its (my presumption) episodic content. because the TV show would need to be a success in itself, a success of "The Walking Dead" or at least "Breaking Bad" proportions to ensure continuous quality input. Without putting down the game itself (which looks like it might be great), I'm afraid its future outlook will match Defiance.

- Back to price cut. Price is not the most hindering factor. Heck, PS3 has been more expensive throughout the generation and still came out ahead. This is particularly true to non-English speaking territories, in which PS4 will outsell X1 regardless of the price. In Croatia, a country with low-to-medium income consumers, PS3 outsold X360 by an enormous ratio, even though it was constantly at least 100 Euro more expensive. and even though all X360s were modded and pirate-ready. People were willing to pay more and then buy PS3 games than to pay less and buy blank DVDs.
So, basically, EU price cut should come last. MS will sell as much as it would have with a higher price point, and only sell more consoles at the tail-end of the generation.

So, TL;DR - MS will not cut price, it will invest in content and try to gain customers that way.

well, thye have the balls to do so. BUT, i dont think they will, i think they will do a price cut at gamescom or around that time, when they will have some big third party games releasing (destiny and others) and most probably an exclusives game like Quantum Break, Sunset Overdrive or Forza Horizon 2.

$449 with a game has been a fact for some time already, so I absolutely expect them to officially confirm it. Will they go even lower? Don't think so. They are doing quite fine in NA and they know at this point they don't stand a chance in EU and Japan no matter what they do - their console is just too much inferior and they have no games or other services to make up for it. They need to keep it cool and tease Americans with Halo 5. It will be enough for that market. You Americans sure love your Halo.

Croatia is not a good indicator for Europe or a significant market. The main markets; France, Germany, Spain, Italy etc are countries that buy the bulk of consoles in mainland Europe. The xbox one is selling but once you take the UK out of the figures its just a fraction of ps4 sales. Price advantage has always been a huge factor in sales levels. Price drops extend the number of consumers willing or capable of buying a product due to hitting a level possible for their disposable income. Other factors do come into play like the product or branding but the xbox one is a good product just not class leading performance and the Microsoft brand while not the best brand is established in gaming. Currently though Microsoft are trying to sell a weaker performance level console at a higher price than a more powerful console with more attractive branding. Lets not forget that if consumers aren't buying them retail channels will gradually start to reject the product due to low sales. Consoles are a popularity contest and as one becomes more popular than others that actually leads to even more popularity as it becomes the major format. It gets more support and better developed games as there is more money to develop for it due to a higher install base. Microsoft can not afford to let ps4 win so easily. It won't be long before there is a 2:1 ratio of ps4 to xbox one in the world. That will be hugely damaging to the Xbox one. It doesn't have to be a permanent price drop, short term promotions can be used to shift more stock.

The important thing is to react to the market so the xbox one is not left behind.

A 349$ Xbox One without Kinect would be a good idea, but I don't think that is happening anytime soon!

Of course, you are completely correct.

But I must point out that is a much better indicator of those "60 markets" difference. Croatia is one of those markets, and X1 can get released here in September for 300 Euro and still get easily outsold by a 400 Euro PS4.

EDIT: Of course, there is actually no need for an official release, since X1 is being sold here ever since Nov.22, 2013. There are no official numbers because it's private enterprises importing it from the UK, but they have also significantly reduced the price in the past few months.