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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 Hiawa23 on 8/4/2008 6:19:52 PM , Rating: 3
I own both the PS3 & 360, & to say the PS3 is a piece of art & the 360 isn't is ridiculous. I own 50 Xbox 360 games, & 5 PS3 games so most of my gaming is on the 360, & it excels at what it's supposed to do, play games. I don't buy consoles to watch movies, so as far as I am concerned the 360 is every bit of the piece of art as the PS3.


RE: Whatever
By larson0699 on 8/4/2008 8:34:48 PM , Rating: 2
Right on!

IMHO the PS3--while a true, respectable wonder as a system--is overdeveloped and inadvertently focused on those with money or fanboys that thought, "Hey, the PS2 was good..."

I'm no Microsoft fan myself, but I would be a liar to say they haven't hit the nail smack on the head with both of their game consoles. Most of my sentiment on that is opinion (ergonomics, titles) but there is validity in that the 360 is the most universal and practical game system yet, based on its impact(s) on your wallet and overall experience (especially online). The hardware is a little worrisome, but for better or worse I'm glad that it wasn't their defining factor.

To be fair, your opinions could just as easily favor PS3, but I'd like to hear why.


RE: Whatever
By fibreoptik on 8/4/2008 10:36:36 PM , Rating: 2
Again with the number of games.

It IS getting old, isn't it? :p


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