i doubt there going to cut the elite 100$ and the pro 75$ + there supposed to be going with bigger HDDs this year i think 25-50$ cut on all skus and if the ps3 goes to 300$ yeah it will be half price but the price diff will be 150$ instead of 200$

wat about EU wat do u think will happen there the Pro is cheaper than the wii in EU already cause of 2 cuts last year

I just don't see why Microsoft wouldn't take the chance to have a $200 priced console capable of taking full advantage of Xbox Live (which is probably their biggest cash cow and best way to keep customers on the Xbox brand). The Arcade is nice as an entry model, but I bet Microsoft makes more money from the Pro owners.

In December 2009 the 360 will be 4 years old. $200 is just $50 less than the Wii (which includes a game). It seems like a great price to have before the holiday season.

Really? in the Netherlands they are both 249 euro... the arcade is 179...

edit nevermind... just woke up...

http://news.softpedia.com/news/Microsoft-Cuts-Xbox-360-Prices-in-Europe-93632.shtml

maybe in some region its not

Maybe it depends on the countries. In Amazon UK the 360 Pro is cheaper than the Wii.

Just for kicks I searched at Amazon France and it's also cheaper there:

http://www.amazon.fr/s/ref=nb_ss_w?__mk_fr_FR=%C5M%C5Z%D5%D1&url=search-alias%3Daps&field-keywords=360&x=0&y=0

oh.. my bad.. didn't checked it correctly... you right the wii is at 249 and the 360 pro at 239

@NJ5

It still bucks the trend. MS won't cut the price by $100..they just won't do it. They never have, and the console is the cheapest on the market and far cheaper than who they consider their 'main competition' in the PS3. I'm not arguing a price cut, or them even being slightly aggressive with it. But at the price points the 360 bundles are at, I don't see them adjusting the price much this year. My thinking is that they'll try to bundle more stuff and include vouchers or extra controllers or a wireless adapter etc. etc. over lowering the price.

In effect, adding things to the bundle is 'lowering the price', but you just can't 'see' it. The price is the same, you're just getting more for it. This is a far more likely scenario to me.

But I'm not saying you're completely wrong. You may very well be right, MS could do what they never have and drop the price like that. I just think it's a bit too ambitious and unneccesary, but it's also only May. I think they expect a PS3 price cut soon, probably $50, and their response will be based on the effect that has over, say, the first month of the PS3s price cut. They're still trying to make money, and cutting the price as much as you're suggesting will be cutting out a large chunk of the pie.

Actually thats a simplistic assessment im sorry.

Every Xbox 360 console sold is like an investment for the future really, its balancing the present hardware loss with the future revenue streams from each sold console. This is why the equilibrium price for consoles cause negative margins on the hardware.

Why would they cut the price? Their future customers are feeling the pinch, so people are even more price concious than ever before which means that even they will have to cut the price to sell as many consoles during the holiday season as last year.

Heres a case study: Assuming that theres only one $300 SKU which costs $275 to make. Each *extra* console sold is worth $50 per year revenue.

If the price was $300 they would sell 1M consoles and net $25M ($300M - $275M) + $50M (1M consoles x $50) = $75M now or $175M over 3 years.

If they reduced the price to $200 each console would cost $275 (Economies of scale, reduced retail margins) and they would sell 1.75M*** consoles. They would lose $130M ($350M - $480M) + 87.5 = loss of $42.5M, making $45M net profit the next year and $132.5M the year after.

So you see, both strategies are viable, it just depends on which one they choose to take.

Btw, the reason why I chose 1.75M is because so long as demand is elastic (which means revenue rises as price drop) they should net more overall revenue than before a price drop.

Squilliam said: I hope im right!

 As as PS3 fan, I'd really like that to happen, honestly....

for all the wrong reasons.

Wasnt MS planning on discontinuing the Elite? I could see them giving that like a $50 price cut for the Elite to help push it out for good. As for the Arcade and Pro, Its already well below the price of a PS3, so unless PS3 gets a price cut i see no reason for the lesser 2 models to have one.