Console prices to drop (analyst)

Michael Pachter, an analyst for Wedbush Securities, thinks that Microsoft is going to get a bit more aggressive when it comes to pricing. With the success of Kinect, there’s a good chance that he maybe right in thinking that the Xbox (250GB?) + Kinect bundle might reach the sub-$300 price point later this year.

Price cuts are a very normal part of a game console life cycle. The overall business model is to have an installed base as large as possible, then make fat money on the software sales: the console maker usually gets royalties on every single game that is sold.

The last price cut for Xbox was a year (or so) ago, and it’s very likely that another one will come in 2011. For prospect buyers, the real question is “when”, and the best-guess answer to this is: E3 announcement (June 2011) and an effective drop either immediately or by back-to-school time. Obviously, this would put pressure on Sony and Nintendo to do the same. Via Ubergizmo FR

Hubert Nguyen
Categories: Gaming, Top Stories