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Xbox 360 Arcade Price Drop  (Source: VGChartz)
Microsoft price drop will make Xbox 360 Arcade cheapest next-gen console

The console wars are raging now as the PS3, Wii, and Xbox 360 fight for top spot in market share. One of the reasons the Nintendo Wii is so popular is its price tag. The Wii is currently the lowest cost next generation console available.

According to VGChartz, the Wii may not be the lowest priced console for long. According to an image acquired by VGChartz, the Xbox 360 Arcade console will get a price cut to $199.99 on September 7, 2008. The price cut would come only a few months after the 20GB Xbox 360 received a price cut to $299.99 and the 60GB Xbox 360 was announced.

Microsoft has said in the past that it knows the sweet spot for console sales is $199.99. VGChartz reports that when Microsoft dropped the price of the Xbox 360 in Europe to 199 Euro in February of this year, the console sold at significantly higher volumes than before the price cut was put into effect. VGChartz reports that it’s tracking information shows that the Xbox 360 sold 100% more units in the 6 months after the price cut than before.

The low price leaves many wondering if Microsoft can actually be profitable at a $199.99 price point. At launch the Xbox 360 cost about $525 to build and by November of 2006 the price according to iSuppli to build the Xbox 360 was about 40% less.

DailyTech reported in September 2007 that the Falcon CPU revision in the Xbox 360 made the CPU about 50% less to build. In May, DailyTech reported that the Jasper update would be on the market in August, which would coincide with a significant price drop for the Xbox 360 in early September. The cost to build the Xbox 360 Arcade could be reasonably expected to drop again with the Jasper update.

In short, Microsoft could well be profitable at the new $199.99 price point for the Xbox 360 Arcade. However, when first launched Microsoft was more than willing to take a loss on the console to get them into homes. Microsoft could be doing the same thing with the Arcade and selling it as a loss leader to increase its market share.

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RE: Whatever
By Enigmatic on 8/4/2008 4:42:40 PM , Rating: 2
Why would anyone care about a one year headstart? Do you have some affiliation to Sony? If one console has better games because of the year head start, then so be it. Whining about a PS3 not having as good selection games because it was released a year later is irrelevant, if it's not worth it to the consumer it's not worth it. Bottom line.

Note: I'm trying to bash the PS3 here, just to incredibly pathetic one-year start excuse which I thought was all but extinct (but apparently some people still cling on to it).

RE: Whatever
By Enigmatic on 8/4/2008 4:43:10 PM , Rating: 2
Edit: Sorry I meant "I'm not trying to bash the PS3 here"

RE: Whatever
By fibreoptik on 8/4/08, Rating: 0
RE: Whatever
By Bryf50 on 8/5/2008 1:09:29 AM , Rating: 2
I dont understand, why would a consumer care about who had the development lead? If you went to a store now to buy either one, why would you care what one came out first when making your descision?

RE: Whatever
By Chaser on 8/5/2008 8:53:24 AM , Rating: 2
This a 360 thread. And you're off topic. (I am a happy PS3 owner, and MGS4 is a masterpiece with "optional" cut scenes spin doctors.) But really you need to get over it.

But I do have one question since I don't own a 360 and don't keep up on them very much. Does the Arcade version not have a hard drive? If so I think it would be very useful for M$ to market 360s only with hard drives and phase out the rest? Just my thoughts.

"Game reviewers fought each other to write the most glowing coverage possible for the powerhouse Sony, MS systems. Reviewers flipped coins to see who would review the Nintendo Wii. The losers got stuck with the job." -- Andy Marken

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