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Microsoft Shouldn't Cut Xbox One Price Now

Feb 25 2014, 11:11am CST | by

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Microsoft Shouldn't Cut Xbox One Price

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Microsoft Shouldn't Cut Xbox One Price Now

Cutting the price of the Xbox One this early into the console’s life-cycle would be a mistake.

If Microsoft slashes the price of its system from $499 to match Sony’s $399 PS4, the tech giant would lose money—quite a bit of money—on each unit sold.

This would give critics of the Xbox brand more reasons to urge Microsoft to dump it altogether and focus on more profitable divisions.

While potentially a smart short-term move for Microsoft, dumping Xbox could have negative long-term implications more difficult to quantify.

The Xbox gives Microsoft a direct line into the living room, and has the potential to be an integral part of Microsoft’s broader mobile/PC/entertainment ecosystem.

Microsoft also risks alienating early adopters by slashing prices, a nerve they may have touched when they chopped some off the top of the UK’s Xbox One price.

Instead, Microsoft should continue to sell the console at its current price, even if that means a continued #2 place in the console race with Sony’s PS4. Being profitable in second place is a better position to be in than losing money on a blue ribbon.

Instead of a price-cut, Microsoft should continue to release value-added bundles like the upcoming  Titanfall bundle releasing this March .

While consumers will still pay $499, they come away with a full retail game essentially free-of-charge.

And since Microsoft is including the game as a digital download rather than a retail disc, the cost of the bundle to Microsoft is essentially negligible.

This is how Microsoft should continue promoting the Xbox One—by adding value to the system through bundles that, at the same time, help promote Xbox exclusives like Titanfall.

Other games, such as Project SparkQuantum Break, and Sunset Overdrive should also release alongside system bundles. (Not to mention future releases such as the new Halo and Gears of War.)

Microsoft is already doing a better job this generation of focusing on exclusive content than in the past, with a number of interesting looking exclusives in the pipeline.

Doubling down on this strategy is the only way the Xbox One can catch up with its PS4 rival.

Bundling is a business model both Sony and Nintendo have pushed much more aggressively than Microsoft in the past.

2013 saw a handful of different PS3 bundles, including a special God of War bundle from Sony. Nintendo has released some Wii U bundles recently as well, including the Legend of Zelda: Wind Waker HD bundle. These are savvy ways to promote both hardware and software and add value for customers.

Microsoft may be able to sell at a loss and survive, but the Xbox brand itself would look increasingly dubious to investors and analysts alike. I don’t think that’s a risk Microsoft should take, at least not anytime soon.

Follow me on Twitter  or Facebook . Read my Forbes blog here .

Source: Forbes


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Update: 5

Minecraft's console versions have now outsold Minecraft on PC, Mac

Source: Eurogamer

Xbox One Launch
Minecraft's console editions for PlayStation 3 and Xbox 360 have now sold more copies than the game's original PC and Mac version.The latest tally of total Minecraft sales stands around the 54m mark, developer Mojang's Patrick Geuder revealed via Twitter yesterday. That includes PC and console editions, as well as copies of the mobile version for iPhones, iPads and Android devices.And that's without the influx of extra sales ...
Source: Eurogamer   Full article at: Eurogamer Jun 26 2014, 3:41am CDT


Update: 4

Developers now have access to 100% of Xbox One GPU

Source: Develop Magazine

Xbox One Launch
Developers will now have access to 100 per cent of the Xbox One GPU, Microsoft has confirmed.It recently made changes to the development kit enabling creators to access an extra ten per cent of the GPU, previously reserved for system level processing, including Kinect-related skeletal tracking data.The news came after Microsoft announced it would be unbundling the Kinect from certain Xbox One SKU ...
Source: Develop Magazine   Full article at: Develop Magazine Jun 18 2014, 5:00am CDT

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Update: 3

Buying the Surface Pro 3? Here are the apps, games, programs and accessories you need

Source: BetaNews

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As someone blessed with the opportunity to try the Surface Pro 3 early, I can say it is truly a game changer. It is very light, has great battery life and a big beautiful display. The tablet/laptop hybrid is far beyond offerings by competitors, including Apple. If you even consider buying a Macbook Air over this, you are arguably making a huge mistake. With that said, the Surface Pro 3 will begin hitting stores this Friday, June 20th. While the computer is great out of the box, it is not co ...
Source: BetaNews   Full article at: BetaNews Jun 15 2014, 2:01pm CDT

Update: 1

Microsoft Believes It Will Sell More Kinects in the Long Run

Source: IGN

Microsoft's head of Xbox, Phil Spencer, says that the company's new Kinect-less Xbox One will ultimately lead to more sales and a greater number of Kinects in gamers' homes. "This might seem backwards, but I believe the decision we made to allow people to buy Xbox One without Kinect included, in the end, will actually lead to more Kinects in the market," he said, speaking with Polygon. "I believe that you've ...
Source: IGN   Full article at: IGN Jun 14 2014, 11:06pm CDT

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