The funny thing bandied about here there and everywhere is the price of the consoles, but only the list price of the console itself usually. I have never seen anyone factor in the cost of the games that people almost always buy with the consoles as well, and yet the number of people who walk out with a console without actually buying games is pretty small. A naked console without games is pretty much just a naked console. Bundles change things up a bit of course, but most consoles sold aside from the Wii are 'naked' in that they come with no games.

So first things first, a bare minimum case scenario:

Someone walks into the store and buys a console, gets one game.

Arcade: $200 console + $40-$60 (usually) for the minimum of one desirable game = $240-$260

Wii: $250 console (already comes with the highly desirable Wii Sports game, yay Nintendo!) = $250

PS3: $400 console + $40-$60 (ditto as Arcade) =$440-$460

So the bare minimum reality is this: The Arcade is about as expensive as the Wii because Wii Sports rocks and its the perfect first game anyway. Beyond that the fabled half price meme is pretty much dead in the water. Theres also the point that people would tend get at least two games with their console most of the time which brings the figures up to $300-$340 for the Wii and Xbox Arcade and $500-$540 for the PS3.

The difference is both significant between the Wii/Arcade and PS3 and insignificant at the same time. There are questions of affordability and value in that people may not want to pay a significantly higher price for what they consider to be an identical experience. However people will still gravitate towards the console brand they prefer the most and for some Blu Ray is a significant value adder. Also this segment isn't the largest in the market, for example the average sale price of the Xbox 360 is ~$270 from what I remember and thats with the recent shift due to the recession.

Next up, a core gamer scenario:

This is what I consider would be getting a 'core experience' for a console. With the Wii local multiplayer is king so getting an extra controller is a must. For the Xbox 360 online is where its at so getting a Live gold card to go with the console seems pretty typical to me as well in this scenario. But since they don't have to get it when they buy the console i'll leave it bracketed. Also you would expect that your typical core gamer would walk out with at least two games so im chalking that in at a round $100 for games.

Premium: $300 console + $100 = $400 ($450 if incl Live Gold)

Wii: $250 console + $40-$70 (extra controller, Wii play/nunchuck) + $100 = $390-$420

PS3 $400 console + $100 = $500

So there really is no significant difference. People at these prices will probably just get whichever console strikes their fancy.

Finally, Last Christmas you gave me a bundle:

The interesting thing about Christmas is not only the sheer number of people looking to buy consoles, but the sheer availability of bundles at all price points. The significance is that its very likely that most people will be able to buy a console with a bunch of adequate to good games and the list prices on the console are infact the price people can walk out of the shop paying without getting anything else. In that sense so long as the bundles are considered equally good the price on the sticker can have a larger impact than during other times of the year. We've seen the effect of a good bundle on sales, like for example just after the PS3 price cut the Xbox 360 had an excellent MUA, Forza, Viva Pinata bundle and sales where relatively close to the PS3. Once the bundles ended then the difference became quite obvious.

The price on the sticker is misleading. Once the games and other things are factored in its really quite a close match between the consoles most of the time. Its really a question of how desireable the console is rather than how cheap it is because consoles are still quite expensive once captain obvious arrives with a bunch of games to stick down next to the console on the checkout. Theres the entry level of the market, its worth a note but its not worth obsessing over as most people who buy consoles have jobs etc and aren't broke teenagers unlike a significant proportion of the sites userbase.

Well 1st, the last line is pure win, spot on.

When it comes to christmas, price wise, I don't think the Wii and 360 are different from each other at all, they're around the same ball park and its not going to sway any consumer either way.

but when i buy a ps3 this week it willl come with killzone 2/MGS4. So i will not buy anymore games for it

@dsister: its a temporary bundle, im talking about a typical case scenario where the only official bundle that week is Wii Sports, which is 85% of the time outside of the holidays.

Oh, ok got it.

bundles bundles bundles.

Why would you buy a second wii mote tbh? I still only got one...

Mario kart wii with friends? GC CONTROLLERS
SSBB with friends? GC CONTROLLER
Wii sports with friends? Most of the games aren't with 4 people at the same time anyway, so you only need 1 controller for bowling, golving, baseball,etc which are the sports most people play.

Wii and PS3 offer online play out of the box so let's include Gold for the 360.

Wii Sports and a couple other games can do multiplayer with just one Wiimote/Nunchuck combo so let's not tack on that additional cost.

Let's also throw out that random $100.

Now we have:

Of course, we need some games for these consoles.  Outside of some very specific bundles, only the Wii is guaranteed to come with a game so let's tack on a game for our 360 and PS3.

Oh yeah, let's throw in some proper cables for them too.

From all this we conclude:  gaming is freaking expensive...

Wii Sports tennis seems like a decent reason to. If you're unhappy with that you could always delete it in your mind.

TBH I don't think there are many GC controllers in the wild and I certainly don't believe even 1/5th of new Wii buyers this month have them handy.

Don't forget the extra cost incurred with an XBL gold account is annual, so it will add more than $50 to the lifetime cost of your console, it just takes longer to do it.