Price cuts on Xbox 360 may prompt price war

By Patrick Avenell

Microsoft has delivered the first crucial blow in the vital games consoles Christmas donnybrook, cutting the prices on its Xbox 360 models. Are Sony and Nintendo set to respond in defence of the PlayStation 3 (PS3) and Wii devices?

With 43 days until Christmas, Microsoft has made its marketing intentions for the Xbox 360 clear – it’s focusing on price. And an attractive new price it is too, with the entry level Xbox model, the Arcade, now south of the $300 price point. This is only a $50 cut in real money terms, but an incalculable reduction in price theory terms, with the reduction to RRP $299 making the unit now more attractive at subliminal level.

Taking $100 price drops are the Pro and Elite models, which are now RRP $299 and $549 respectively.

Although the Arcade was already the cheapest console on the market, this price reduction puts clear sky between it and the Wii, which is now $100 more expensive. That represents a significant jump, even more so considering the penny pinching expected in the current global economic climate.

The PS3 is more expensive again, currently RRP $699 The Blu-ray technology is a good selling point, but with the market’s heretofore quasi-rejection of Blu-ray, will a sudden downward thrust to the retail price be the only way of keeping stock moving this Christmas?

Current.com.au has asked both Sony and Nintendo for comment, and we hope to publish their responses tomorrow.

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