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As long as it's cheaper than PS3, it'll be status quo

Even before the XBOX 360 launched last year, Microsoft openly stated that it planned to reduce the price of its newest console on a yearly basis. Now, a year later, some gamers are waiting for that forecasted price-cut, despite constant denials

Rumors of a price drop recently surfaced on the ‘Net, perhaps fueled by consumer expectations of a reaction to competition, and by a DigiTimes story claiming that a $100 drop would be possible. DigiTimes cites sources stating that Microsoft “has negotiated reduced production costs for the XBOX 360 with Taiwan-based manufacturing partners” and “total production cost can be reduced by 15-20% due to diminishing costs for most components along with increasing production scales and decreasing defect rates.” 

It’s no secret that Microsoft will be giving its chips a die-shrink from 90nm to 65nm to reduce costs and combat heat issues. The change in process, however, isn’t going to happen until 2007. 

In the end, it’s all up to Microsoft to decide cut-or-no-cut. At the recent X06 event in Spain, Microsoft’s Peter Moore responded to the question of pending price drops with a succinct “Certainly not.” Microsoft’s explanation is that it still believes that the XBOX 360 offers great value to the consumer, which likely means that it is perfectly happy to sit right between Wii and PlayStation 3. 

While the price of XBOX 360 may remain unchanged, bundling options are still wide-open. Some XBOX 360s currently come packed with a game and some Live goodies at no extra cost, and bundles could improve as the holiday season approaches. 

Some have speculated that, instead of a price drop, Microsoft will include the HD-DVD add-on in the XBOX 360 Premium bundle to match up with PlayStation 3’s Blu-ray ability. Seeing as how Microsoft says no to a $100 price drop, it seems unlikely that a $200 accessory be included for free. But if it were so, wouldn’t that really throw a wrench into Sony’s plans?

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core/premium makes pricing difficult
By abhaxus on 10/3/2006 10:36:47 AM , Rating: 2
Having two bundles makes it difficult for me to imagine a big price drop for the 360. I would like to see the premium bundle below 350 though... or the HD-DVD drive in a bundle for 500.

RE: core/premium makes pricing difficult
By FITCamaro on 10/3/2006 11:04:30 AM , Rating: 3
A bundle with the HD-DVD drive for $450 in the states would really throw Sony off. I doubt it'll happen, but its nice to dream. I'd like to pick up an Xbox360 but I'm waiting for the 65nm conversion. I've got MC2005 so I can stream all my video through it as I currently do with my modded Xbox. But I also want to play Halo 3 when it comes out. And Fable 2. Plus a few others.

I'll get a PS3 eventually too, but I'm not paying $500 for a console. In my view, Bluray is going to loose the movie format war and 1080p in games isn't that big a deal. 720p is fine and shiny graphics don't make a good game.

RE: core/premium makes pricing difficult
By othercents on 10/3/2006 11:10:15 AM , Rating: 2
It is really about the games. Most of the college kids I know say that the Xbox360 does not have the games that the PS2 has. Everyone wants to play Halo3, but after that there is nothing else they want to play. Because of this, knowing which console will be the best in the end is up in the air. You still have the X factor of Wii which could take the market by storm.

Anyways back to the article. If Microsoft said that they would be reducing their price, then they should reduce their price. I think they are not planning too because the PS3 was priced so high. If the PS3 ended up being around the same price as the 360 then Microsoft would have reduced the price. It is unfair to the consumer to say you will reduce the price and then later on say you won't. Some people might have been waiting for the cheaper units.


By IMPoor on 10/3/2006 1:45:10 PM , Rating: 2
I am tired of hearing that Xbox does not have good games. Thats just a lie. Most of the major companies make the same exact games for every console. If I had to geuss I would say only about 10% of the games out there are console exclusive. The other 90% are released on all consoles, usually at the same time. So no matter which console you buy you will have no trouble finding games to play. Kids just want what other kids want. Thats not always the best option its just whats popular.

I am personally very happy with the xbox360. I do not plan on going out right away to buy a PS3 due to price mainly but I do not think its gonna suck. If the 360 drops in price or they come out with better bundles then thats great. I need more of my friends online so I have people to play with. I think it would be way more awesome if they made the games cheaper. $60 is robbery.

RE: core/premium makes pricing difficult
By tuteja1986 on 10/3/2006 11:16:14 AM , Rating: 2
I don't think XBOX 360 needs any price cut , after what showed at TGS and X06 , XBOX 360 game line up is way stronger than what sony has. Alot of exlcusive new IP game worth getting excited about.

RE: core/premium makes pricing difficult
By Loc13 on 10/3/06, Rating: 0
By therealnickdanger on 10/3/2006 3:48:16 PM , Rating: 1
OMG... Sony won 3/4 of the awards across two consoles (PS3 and PS2)???? At the Tokyo Game Show In Japan??!?? How did that happen? LOL

By Xavian on 10/3/2006 4:48:37 PM , Rating: 3
this is due to Nintendo not going to TGS. Something they have done since TGS's inception. TGS used to be a purely Sony show, now its a Microsoft and Sony show.

If Nintendo went to TGS im sure they would get many of the awards Sony got.

RE: core/premium makes pricing difficult
By Chris Peredun on 10/3/2006 12:10:44 PM , Rating: 2
Canadians can currently get the following for CDN$450 (~US$400)

- XBOX 360 Premium
- PGR3
- NHL2K7
- 1250 Microsoft points
- Additional 3-month Live card

I expect this kind of bundling will become the standard come the holiday season.

RE: core/premium makes pricing difficult
By Pirks on 10/3/2006 1:44:40 PM , Rating: 1
Canadians can currently get the following for CDN$450
Canadians can currently dream about CDN$450 'cause with sales tax it's CDN$520 ;-) And if you shop at it's close to CDN$600 with tax, so keep dreaming :)

By Chris Peredun on 10/3/2006 4:09:15 PM , Rating: 2
CDN$505 including taxes, if you pricematch FutureShop to WalMart. Considering that used to be the cost of just a Premium system, I consider that a fairly good deal given that you get two games, four months of Live, and 1250 points.

As if MS would tell us the truth
By NotAok on 10/3/2006 11:33:32 AM , Rating: 5
I love how every interview with MS features a question regarding a price drop, as if ms would really tell us the truth.


RE: As if MS would tell us the truth
By therealnickdanger on 10/3/2006 11:37:00 AM , Rating: 2
I know, c'mon. Why on earth would ANY company that sells a product tell consumers when they are going to lower the price??!? On top of that, why would consumers even expect them to tell? LMAO That's not how it works. The price will drop when the rules of supply&demand dictate.

By rushfan2006 on 10/3/2006 3:20:50 PM , Rating: 1
Agree with both you guys.

I was thinking the same

What's more funny is reading the articles about like the author of the story is even shocked "and MS simply said certainly not" (to a price drop)...

Wow that's shocking MS said NO price drop in store to the MEDIA, who's job is to inform amazing...


My advice
By obeseotron on 10/3/2006 3:52:45 PM , Rating: 3
My advice to MS would be:

-Kill the core system (It was always pointless)
-Drop the old premium to $350 (Basically the cost of a core with a memory card now)
-Integrate an HDDVD drive in a new premium pack for $450-$500

RE: My advice
By lemonadesoda on 10/3/2006 7:07:38 PM , Rating: 2
That should be $360 for the X360. It's just better marketing that way.

RE: My advice
By Sharky974 on 10/5/2006 6:30:42 AM , Rating: 2
And your advice is stupid. Microsoft will drop the premium before they drop the core, you mark my words.

microsoft haters (bet you are one!) are always wanting MS to drop the core because it's a big advantage eventuallyy because PS3 will always have a HDD.

It doesn't matter now, but in 2-3 years when these consoles are pushing under $200, a $50 HDD standard is a big cost. Ask Xbox 1.

Including a standard in HDD was one of the stupidest moves Sony made arguably stupider than Blu-Ray (the cost of Blu Ray looms large now but will eventually fall to ~DVD) but the HDD cost never falls.

Anyway, they just introduced the core in Japan, rather than phase it out they are increasing it.

The best strategy though would be to drop the Premium pack. Two SKU's confuse the market. Then drop the core to $249 this Christmas and boom, you own the market, with only a $50 price drop.

Then drop the HDD add on to $49. Dont worry about profit on that (there's plenty of other overpriced accessories to gouge people on anyway), $49 is probably cost+small profit, you want people to buy it for Live, and it's still way better than giving it away free like they did with Xbox1.

My plan if I say so, is pretty brilliant. Tons of people will still buy the HDD, it's only $10 more than a memory card. Yet your system is out there for $249 with no confusion. If you really want to cut Sony's throat pack in Gears LOL, but that wont be necessary.

By DigitalFreak on 10/3/2006 12:21:27 PM , Rating: 1
But will this include the Internal HD-DVD drive?

I'm planning a 2008 purchase for the Xbox 360 which is the last out of the three next-gen consoles (with Wii as 2nd and PS3 as 1st).

Someone give me info.

Hmmm... let me consult my crystal ball...

It says "no one knows, so STFU"

By Dactyl on 10/3/2006 8:21:06 PM , Rating: 3
Why do you need info now? You're not buying the thing for over a year!

And why would you describe the 360 as the "last" of the next-gen consoles, when it's the first (and only) console out?

By Serlant on 10/4/2006 6:10:45 AM , Rating: 2
i think he means itll be the last next-gen console he buys, he states that he'll get a ps3 then a wii and then he'll get an xbox360
I'm planning a 2008 purchase for the Xbox 360 which is the last out of the three next-gen consoles ( with Wii as 2nd and PS3 as 1st ).

most games will never need TRUE HD
By Vesuvius on 10/3/2006 3:14:50 PM , Rating: 2
HD-DVD/Blu-ray will be mostly pointless from the gamers point of view. They announced, I believe back in Aug, that less than 10% of all games will support resolutions higher than 720p thus no HD-DVD/Blu-ray required.

I seriously doubt the xbox will ever change from internal DVD to HD-DVD. Maybe in lieu of a price drop they will make the HD-DVD internal. But as long as you are all dumb enough to pay an extra $200 for an add on they'll keep selling then separate. And for them to rely so heavily on an add on piece of their console sounds much like a SEGA move, and it never had the slightest chance of working. Developers aren't interested in developing for an add on piece of hardware.

Doesn't MS usually say...
By underline21 on 10/3/2006 3:49:01 PM , Rating: 2
That they don't respond to rumors?

By Doormat on 10/3/2006 10:21:30 PM , Rating: 2
Core: $250 (to compete with Wii)
Premium: $350
Pro: $500, HD-DVD integrated, 60GB HD to really stick it to Sony.

I'd roll out these changes on the Tuesday before the PS3 launch (2 days before PS3, 4 days before the Wii).

By Chillin1248 on 10/3/2006 1:26:08 PM , Rating: 2
Shekels (NIS) ... I see you are Israeli, shalom. :)

Anyways that will never happen, I don't have the time right now to go into details why, but I can say what I think will happen.

Two different Xbox360s, one with internal HD-DVD and one lacking it. The HD-DVD model will probably be called copper or diamond (platinum being the current), the non HD-DVD model 65nm will feature no name change other than a serial number modification. There will also perhaps be special coupons to buy later a HD-DVD drive with the included movie for the non-HD-DVD version of the Xbox360 in 65nm. (I assume this is where Microsoft will save money in including the HD-DVD in the Xbox360 by just including the standard game and no movie as well as the hardware).

I also believe there will be "Special Edition" games for the Xbox360 put out on HD-DVD that will be exactly the same as their DVD-9 counterparts except that they have some special features like:

Behind the scenes (God of War had this)
Deleted content
Extra map
Extra Microsoft points
Bonus characters/skins?
Revised manual and small figure

Small stuff that add up to a value people like, but I highly doubt there will be any HD-DVD exclusive games.

But you must understand, Blu-Ray in the PS3 is mainly there as a movie format only, Sony could have gotten away with putting their games on DVD-9 like Microsoft but they have a standard to back.


By kilkennycat on 10/3/2006 2:20:29 PM , Rating: 2
... no HD-DVD exclusive games (on the Xbox360-HD) ? You must be joking !!

Since current graphically-intensive games are now topping 6GBytes, it is only a matter of a very short time that game developers will want to break the DVD-limit, especially after introduction of the PS3. Blu-ray or HD-DVD finally allows the developers to get away from cut-scenes with fuzzy images and/or low frame-rates due to compression, whatever about the in-game data necessary to consistently render a scene in all of its 1920x1080 glory.

The current sweaty-hot Xbox360 based on 90nm technology will be totally obsolete by the end of 2007 --- the manufacturing cost of incorporation of a HD-DVD drive by that time will be only a couple of $$ more than a current DVD-drive, the cost difference being solely that associated with the blue laser. And this manufacturing cost will be well-offset in the Xbox360-HD by the economies of scale and power-consumption in the move to 65nm ( or smaller) technology. No way will M$$ sell the Xbox360 in both forms, other than when they are running down the inventory of the current version. Not good long-term news for current Xbox360 owners, but that's the price they pay for a non-modular product. After all, we have gone through umpteen generations of camcorders, digital cameras and game-consoles; so what only a couple of generations of Xbox360 ?? Consumers are used to having garage-sales and Ebay will continue to thrive.

By Chillin1248 on 10/3/2006 2:29:41 PM , Rating: 5
Hate to break it to you, but the facts disagree:


As you can see the following facts:

Average size for Xbox DVD-9 games:

Average for 2001: 1.81 gigs ( 21% of disc )
Average for 2002: 2.17 gigs (25% of disc)
Average for 2003: 2.47 gigs (29% of disc)
Average for 2005: 3.20 gigs ( 37% of disc )

Total size increase between 2001 and 2005 was: 77%

Over the course of its life, the size of the average Xbox title increased by 77%. If the Xbox 360 size increases at the same rate, and the four 360 titles are representative of the whole, we can expect the average Xbox 360 title in 4 or 5 years to be around 7.40 gigs, and to occupy about 87% of the disc's capacity.

So I don't think we truly have to worry about the Xbox360 disk sizes being filled up, and even if we do there is still another option; put the game on two DVD-9 disks which would work perfectly for the majority of games out there and still be far cheaper than HD-DVD.

Also with enhanced compression methods like XNA and protein synthesizer (I know I mis-spelled something here so forgive me) I would say we have nothing to worry about at all.

You also forget that MS loses money on every Xbox360 sold right now, 65nm will just cut the losses a bit but they are still losing. And remember, barely anyone needs either Blu-Ray or HD-DVD movies right now... How many people do you know have a 1080p, or even a 1080i, HDTV with HDMI (or component for scaled down) input?


By Chillin1248 on 10/3/2006 2:31:19 PM , Rating: 2
By the way, replace "Protein Synthesizer" with "procedural generation (or synthesis)".


By lemonadesoda on 10/3/2006 7:06:43 PM , Rating: 3
Sorry, but that's one of the silliest analyses I've ever seen. You are "confuddling" statistics across the Xbox and the XboX360 platforms, a completely new generation of hardware and capability.

The Xbox is limited by the amount of code, data, textures etc it can hold in memory, what it can process, and how much texture it can throw at the screen.

The Xbox360 can operate at a different order of magnitude.

Quite simply, the Xbox360 could render scenes with "GIANT" textures that the Xbox could not. It can stream video sequences, or render scenes over video backgrounds.

A photorealistic texture database of GB's is now easy to implement... someones just got to take the pictures or create the content.

During the "conversion" phase, where existing titles move to Xbox360, you will see only a minor increase in total codebase.

But once we move to the new developers paradigm of PS3 and Xbox360, you will see a big step in codebase, mainly driven by large textures and video sequences.

By Chillin1248 on 10/3/2006 9:06:35 PM , Rating: 3
I am going to take some words from my good friend, Mr. TheRealNickDanger:

DVD-9 has plenty of storage for past, current, and future games. In-game rendering eliminates the need for FMV sequences (which is probably why that PS3 game is 20GB), Microsoft's XNA initiative assists developers in producing less-bloated games, and the Xbox360 hardware does amazing things with both compression and this fun little thing called procedural generation (or synthesis). Given a set of rules and minimal number of textures, an entire random forest can be created from just one tree's worth of info... basically... The same goes for buildings, cars, rocks, characters, you name it.

I will only concede one thing in the whole PS3 vs Xbox360 debate. Game audio is still one thing that can't be compressed excessively, so as games (mostly RPGs) become much more massive in terms of character interaction, I fear that the DVD9 capacity may be reached. Oblivion has something like 50 hours of speech (most of which you'll probably never hear) and it consumed roughly half the disc if I remember correctly. Seeing as how a number of high-profile PS2 RPGs came on two discs, it's not unreasonable to one day see 2-disc Xbox360 games if necessary. Given the quality of vocal synthesis in commercial applications, I suppose we may be very close to having in-game-generated voice-acting...

So there is no need to stream videos anymore when you do it in-engine. I would really like for you to read the link I posted to, it explains that compression methods improve as time goes on, regardless of the hardware used on either the Xbox or Xbox360.


By lemonadesoda on 10/3/2006 9:42:14 PM , Rating: 2
Fair enough, Chillin. I'm not trying to get at "you", just the analysis which I think is bogus. Your post does however mention some good points there.

However, procedural generation doesn't help us create textures for skins, walls, objects, backgrounds, video sequences etc. Your quote is nothing more than code can be used to create landscapes rather than using object maps. Nothing new there. Been used for years, that concept.

In theory, compression helps. But take a look at DVD vs HD-DVD and blueray. A one step jump in technology. A one step jump in storage requirements.

I'm sorry, but YOU WILL SEE very large codebases for games in 2008 for the X360 and PS3 platforms. As developers move toward "immersive" interactive titles (melding movie and game experience) you will see a MASSIVE increase in video/quasi-video sequencing.

By Chillin1248 on 10/4/2006 4:50:06 AM , Rating: 3
Please, this is the internet, it is very hard to take offense here. :)

And granted we may see games become larger than 8.5GB withing the Xbox360 lifetime, however for the majority of games there should be no problem putting them on two DVD-9 discs. For most FPS (not online) and RPG (mainly linear) this would work fine. But as I also said, I assume Microsoft is relying on developers to make cutscenes, etc. in the in-game engine to cut down on FMV space... Especially 720p FMV space.

Please keep in mind that (unless it changed recently without my knowledge) Microsoft is targeting a three year lifespan of the console, which is why even with the HD-DVD add-on and no HDMI there is no real worry about downscaling since the protocol is still under discussion and will most likely not be out for a year or two.


By lemonadesoda on 10/4/2006 12:26:48 PM , Rating: 2
I think we agree on something... that 8.5GB is enough for X360/PS3 developers to work with.

My disagreement is with the analysis... that there will be small incremental increases such that it will take us another 5-6 years to reach DVD capacity.

The capacity will be filled within 18 months, through a stepwise jump rather than small incremental change. An order of magnitude shift in the "quality"/"resolution" of content. But do developers REALLY need more than 8.5GB? Nope. And if they did, I agree, in any sequential game, just move to the second disk.

By tigen on 10/4/2006 6:10:10 AM , Rating: 2
Melding movie and game experience? Are you in marketing or what?

To me, the less video the better. Cutscenes in games can be done just as well in-engine (and generally I'd rather play a game than watch it). You still can need a lot of audio or texture data. But it's still not really a problem. Most of the new generation advancement is in processing power. Programmable shader processing for the 3D pipeline, and multiple CPUs. These things are improving without much extra storage requirements.

I wouldn't be surprised if some RPG game might need 2 discs at some point. But there are a lot of games already and they are doing fine on 1.

By lemonadesoda on 10/4/2006 12:38:10 PM , Rating: 2
Expect some big shifts in the type and style of games we see. The last 5 years has changed the gaming scene immensely. We have moved from adventures, board games, puzzles and platform rompers to FPS and RPGs.

It is equally likely that we will see a new genre in gaming within the next few years.

And yes, the "melding movie and game experience" is due to Hollywood studios become increasingly interested in investing/contributing to game production. Its not about "cutscenes", but an opportunity to get involved with a new business model that is very profitable. What has changed over the last few years is that game development is now as expensive as producing film, and the revenues and profits are not dissimilar to box-office takings. The economics of game development and the scale of the market has changed to such an extent that it has become a strategic issue for a lot of, traditional, film based produciton and distribution companies.

More and more people are spending big bucks on home entertainment... and these people (generational and lifestyle) are VERY different from the frequenters of this forum. And their buying behaviour is equally different to ours. So a game concept that "you" or "I" dont like, may well be a blockbuster to the typical movie-buyer who now has a console.

By willow01 on 10/4/2006 1:12:49 AM , Rating: 2
The problem here is no one really knows. It is like when Gates proclaimed that no one will ever need more than 640K of memory (or was that upper memory...something anyway).
Some one please point out if triple A titles will actually use XNA I mean at the moment you're talking a 5-10% performance hit, and just try to pry any game coder from using C/C++ to work with managed code.

By ViperROhb34 on 10/5/2006 11:50:06 AM , Rating: 2
While I dont completely agree or disagree
I think one thing most of us are doing is underestimating the hundreds of millions of consumers that don't play video games.. as in adults over 30.. who will still potentially buy a next gen HD player ..

Huge cost differences could be a driving factor for those who play movies but dont care alot about storage.. Even now.. home recording for tv purposes is not a must.. Home recorders with hardrives while handy are not the sole foundation of the must haves because home recording while very important to a few may not be to the millions who could make or break a format

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