Consoles may get price cut

[12 June 2007]

By Victor Godinez

The Dallas Morning News (MCT)

Xbox 360

Xbox 360

There’s a pretty good chance both the Xbox 360 and the PS3 will see price cuts of at least $100 by year’s end.

That’s because Microsoft and Sony are running out of options in the face of Nintendo’s dominance.

The 360 has a little more breathing room, thanks to a one-year head start and a growing portfolio of truly superb games. Plus, Halo 3 this fall should sell some extra 360s, even at the console’s current price.

But the Nintendo Wii is obliterating the PS3 and closing on the 360 in terms of total sales. While the motion controls for the Wii are undoubtedly driving most of that sales surge, the $250 price tag, lowest of the three consoles, is a huge factor, as well.

While no one from Microsoft or Sony has come out and promised a price cut, the hints are getting a little obvious.

“We are well aware that the sweet spot of the market is really 199 bucks,” David Hufford, a director of Xbox product management, told Bloomberg News.

As Bloomberg notes, Sony sold 75 million PS2s at or below that price. Similar price clues are being dropped by Sony executives.

Sony “does not rule out the possibility of lowering the price” of the PS3, Sony president Ryoji Chubachi told the Yomiuri Shimbun in Japan a few days ago.

Why not just slash prices now and get it over with? Because these consoles are already dragging down the bottom lines at both Microsoft and, especially, Sony, which reported a loss of $563 million in its most recent quarter, due largely to the huge costs of developing and building the PS3.

Since Sony is already subsidizing the PS3 and Microsoft is, at best, breaking even or slightly better on the 360, cutting the price of the hardware would only force the companies to bleed more red ink from their gaming divisions. So they’d rather sell their consoles at their current premiums for as long as possible, buying a little more time to find ways to trim manufacturing costs.

But the Christmas shopping season is simply too important for Microsoft and Sony to concede it to Nintendo. So, if you’re thinking about picking up a PS3 or 360 this year, I’d suggest waiting a few months.

And if you want a Wii, just consider yourself lucky if you can find one on a store shelf.


If you’re tired of paying $60 for games, then perhaps this price will appeal to you: $0. announced last week that it has begun offering free access to a portion of its 900 titles, with new games rotating through the free, ad-based site on a regular basis. Various PC and console games are also available for download and play through the site.

While GameTap does skew toward older titles, there are some newer games up for play, as well. For example, as of Friday, Lara Croft Tomb Raider: Legend was available for free play on the site, while the just-released Tomb Raider: Anniversary is available for download on the paid portion of the site.

Good stuff.

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