The next Xbox from Microsoft is already a reality and so far there have been mixed reactions to Microsoft’s unveiling of the console. This is mainly due to the fact that there is a feeling that the company could have focused more on games rather than its entertainment functions. But that’s an argument for a different day.
The prospect of a new console depends on a lot of factors (like specs, features and others), but one of the burning factors of the Xbox One that’s still unknown is the price tag it will arrive with. How Microsoft determines the console’s price is as much art as science.
Price is such an important factor in any business that it can decid how the commodity will fare past its release, and Xbox One is no different. If history has taught us anything, it’s the fact that high priced consoles will get a bit of stick as far as retail is concerned. As an example, remember what happened to the likes of PS Vita and Nintendo 3DS? It’s all connected to the money quotient.
The price of a console also depends on its abilities and performance. With that being said, it is to be remembered that numbers have a strange way of playing with the human psychology. If the One deserves to be priced a little high, owing to the technology it will offer, then there’s nothing wrong with it. But then again, how will it impact on the common man who will think twice before spending such a lot? These are important decisions that will be made in a few months. It’s all plain and simple Economics and marketing ploys.
This is not a comparison with One’s immediate rival PlayStation 4, and although initial comparisons show that PS4 is a bit more powerful than Microsoft’s console, the popularity of the Xbox 360 in the North American market is enough to give it some leverage over Sony.
While nothing is official, it seems likely that the One will be priced less than its immediate predecessor Xbox 360.
According to Robert Lloyd, chief financial officer of games retailer Games Spot, both the Microsoft Xbox One as well as the Sony PlayStation 4 will be priced less than their predecessors, and only a few people will buy them. Hard to believe at this point? Probably.
Gamestop executives, according to a PC World report, “told analysts that their ‘market model,’ based on their own estimates as well as what they’ve been told by Microsoft and Sony, call for the next-generation systems to have a ‘lower opening price point than they did last cycle’.”
“The same model assumes that the adoption rate for both consoles will be between 80 to 85 percent of the past cycle, he said, and that the attach rate for software will be about 80 percent.”
As it goes without saying, a lot of the pricing factor will depend on what Microsoft manages to come up with regarding the One at the upcoming E3. The Xbox One uses ATI chips for both its CPU and its GPU, 8GB of RAM (probably DDR3), a Blu-ray Drive (expected since its arrival with the launch of PS3), USB 3.0, WiFi and Bluetooth. If all these are taken into account, these are the ones that actually a lot of fans expected to see in the start, and the price, luckily, shouldn’t be as sky high as some of us think it will be.
Microsoft, needless to say, will be a bit wary before placing that final price tag on the One, and considering that the company learnt from the mistakes that Sony did with PS3 in the past (remember the $599 launch fiasco?), it’s highly unlikely that it will come up with a price tag that makes it lose potential customers. After all, nobody wants to lose business.
Now we are no analysts, and all these are predictions and speculations, but taking into account what these companies usually do with a new release, Microsoft will initially price the One somewhere around $600 and later take it down to an amount that will seem more reasonable to the potential buyers. The best bet is somewhere around $300-350.
