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Meanwhile Xbox 360 continues to sell strong

Even as the storm over digital rights management (DRM) thunders on the horizon for Microsoft Corp.'s (MSFT) holiday season, the offline-playable Xbox 360 continues to sell strong.

I. Xbox 360 Stays Strong

In May the Xbox 360 marked its 29th month atop U.S. sales charts, moving 114,000 units.  That's down from 160,000 units in May 2012, but then again the console market as a whole ticked downward.  Microsoft's numbers come courtesy of third party sales tracking firm NPD Group Inc.  Overall game revenue was down 25 percent for the month.
In total Microsoft pocketed $149.8M USD in Xbox revenue (from software, accessories, and console sales).

Microsoft is hoping that a redesigned case, showed off at this years Electronic Entertainment Expo (E3) will help it continue its dominance.  The new case resembles the upcoming Xbox One, with a slimmer profile and quieter internals.  The redesign is similar to rival Sony Corp.'s (TYO:6758) penchant for "slim" console refreshes.

Microsoft Xbox 360 refresh
Microsoft's Xbox 360 refresh

Prices for the redesigned 'box remain unchanged at $199.99 for the 4GB version, $299.99 for a 250GB version, and $299.99 for a 4GB version with a bundled Kinect sensor.  Microsoft has announced that it hopes to sell another 25 million Xbox 360s, offering the system as a cheaper alternative to next generation consoles.  That would bring lifetime sales to 100 million units globally.

II. Microsoft: Xbox is 10x... no, 3x... no, 8x... no, 10x... no, 40x More Powerful!

Meanwhile yet another controversy is brewing over the Xbox One -- but this time it isn't about DRM.  Rather it's about the processing power of the Xbox One.

In raw performance of the in-console hardware, Sony's PlayStation 4 will reportedly trump the Xbox One's internals with a slightly more powerful CPU/GPU combo.  But Microsoft's controversial "always on" DRM scheme does offer some degree of parity, allowing Microsoft to bump some amount of processing off the console.

Regardless, Microsoft appears intent on comparing its console against a known -- the Xbox 360.  And it's there that the confusion begins.
Xbox One
The Xbox One

In an interview with Stevivor on May 22 Microsoft Xbox Australia spokesperson Adam Pollington remarked, "It’s also been stated that the Xbox One is ten times more powerful than the Xbox 360, so we’re effectively 40 times greater than the Xbox 360 in terms of processing capabilities [using the cloud]." (emphasis added)

Microsoft Game Studio chief Phil Spencer on Monday's episode of "Late Night With Jimmy Fallon" bragged that the Xbox 360 was 3x more powerful:

Later, at roughly 4 a.m. EST he took to Twitter to correct himself at least twice as he first said 8x, then 10x (without the cloud):

Even if that number is correct there's still some big questions about Microsoft's numbers.  Mr. Pollington's comments seem to suggest that the Xbox One will quadruple its onboard processing power via the cloud.  That's a rather ambitious claim -- and one which will need to be seen to be believed.

If it can indeed up its console's performance by 300 percent with cloud computing, then perhaps it has some ammo against critics of its always-on DRM scheme.  If not, the critics will score yet another strike against the embattled gaming box.

Sources: Microsoft [1], [2; Twitter]

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RE: It doesn't matter to me
By BRB29 on 6/18/2013 1:55:00 PM , Rating: 2
MS has already stated that games will be $60.

Isn't that cheaper in a way? Prices remained the same despite the skyrocketing development costs. It used to be that spending over $10mil making a game was a lot. Now $100m production costs are not rare.

RE: It doesn't matter to me
By Motoman on 6/18/2013 2:50:13 PM , Rating: 3
Not if you can't freely resell/trade/gift the game afterwards. But we've covered that before ;)

RE: It doesn't matter to me
By inighthawki on 6/18/2013 9:52:59 PM , Rating: 2
And I bet with proper sales through a digital market you will be able to get games at all time lows, lower than you'd ever be able to recoup at used games cost. Plus you'll get to keep the game forever, AND all the money (minus fees) goes to the devs. Win-win in my book, but if you want to keep moaning on and on about your right to resell the game you'll lose out on the potential.

RE: It doesn't matter to me
By Motoman on 6/19/2013 10:43:25 AM , Rating: 2
If you live in Europe, their courts have already granted you First-Sale rights over digital purchases. So...apparently that's already sorted for you on that side of the pond.

Here in America, citizens have *no* rights on digital purchases. At all. So's lose-lose, until some magic happens here and America catches up to Europe on consumer rights.

BTW - go on and try to resell a Steam game, or an iTunes download, and let me know how that works for you.

RE: It doesn't matter to me
By Ammohunt on 6/18/2013 2:56:59 PM , Rating: 4
Indie games and some big name games routinely sell for >$30 on Steam. Case in point i picked up Civ 5 for $7.50 and Borderlands 2 for $30. $60 is an artificial and arbitrary price that obviously doesn't reflect development or marketing costs. I will never pay $60 for a console game.

RE: It doesn't matter to me
By BRB29 on 6/19/2013 7:41:58 AM , Rating: 3
Most indie games are under $30. I'm on steam every day.
PC games have always been cheaper than consoles. At launch day, you'll see a lot of games selling at $60 for consoles and $50 for PC. A few months after, the PC games will fall to 30-40 and consoles usually stay 50-60.

The only games that falls out of that bracket is usually craptastic games

RE: It doesn't matter to me
By someguy123 on 6/19/2013 9:32:06 PM , Rating: 2
When selling on PC developers aren't required to pay the royalty fees normally associated with consoles. It's understandable that the standard pricing would be much lower.

I don't think it's reasonable to compare with some of the really good sales like civ 5 for $7.50, though. I'm not so sure civ 5 would make its development cost back at $7.50 per unit at launch, especially since steam and retailers get 30% of that.

RE: It doesn't matter to me
By inighthawki on 6/18/2013 3:49:52 PM , Rating: 4
This also doesn't take into consideration that prices may drop, or there may be sales shortly after launch. Even if Microsoft actually mandated $60 for titles at launch, there may not be such a requirement to keep it at $60 for the life of the title.

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