Topic: Xbox Price Cuts Looming; Nintendo Unfazed

[WindyMan]

The console that offers value by the pound looks to shake up console pricing again, but Nintendo doesn't seem to be all that worried.

Last year, when Sony cut the price of the PS2 down to $199, Microsoft was forced to follow suit, and Nintendo was left no choice to make their GameCube $149.  With Microsoft announcing a 20% price cut in Europe, the rumor mill is turning with the story that a US price cut is next, getting the jump on Sony.

Naturally, any cut that brings the price of the Xbox or PS2 down too close to Nintendo's $149 GameCube range might invoke Nintendo to lower the price the system even more.  However, rather than get the jump on Sony and Microsoft, Nintendo's George Harrison says they'd rather take a wait-and-see approach.  Here's a clip from the Reuters' news story:

Nintendo made it clear on Thursday that if there are to be price cuts, it will not be the one to initiate the move.  

"It is not in our plans. We have historically not led price cuts," George Harrison, a senior vice president with Nintendo of America, told Reuters. "There is always pressure built up before E3 .... We will have to see as we get there."

With Nintendo struggling to sell GameCubes, another price cut might help to boost system sales across the board.  We'll have more details on this as E3 grows closer, but in the meantime, check out the full story on the Xbox cuts here.

[Illini4]

Ok, this is what is called creating a Monopoly.  Obviously Xbox does not have a monopoly right now, but this is the early stages of trying to create one.  This is interesting considering the article from yesterday saying Nintendo will lower the price is charges third parties to put their titles on GCN.  Yes that is just a matter of competition.  But the article also said Sony still had a better deal.  Well of course they do, it is Sony.  I am sure a huge number of people playing their GCN's are on Sony TV's, with Sony suround sound.  And are sitting at their Sony computer using their Microsoft Browser which is running on their Microsoft Windows (not me, i am at my Apple!)  So of course Sony and Micro$oft can slash prices left and right.  Has Micro$oft ever made money on the Xbox console?  Even at $300 I think they were burning money.  I read a report that said over $2billion in one year is how much Micro$oft is giving up with the Xbox.  But that is NOTHING to them!  But to Nintendo, yikes, they would have to rethink their position.  Everyone always talks about the "War Chest" Nintendo has, yeah, about a $6billion war chest.  That won't cut it.  So if Nintendo lowers their prices everytime Sony and Micro$oft does, then we all need to be thinking about which system we will buy, Playstation3 or Xbox2.

I am glad Nintendo doesn't seem scared by this move.  They shouldn't be.  They have a superior console with superior games.  You don't see Porsche shaking in their boots because Toyota comes out with a dinky sports car.  Porsche just keeps making the best damn sports cars there are, and lets Toyota go crazy with their Corrollas and Celicas.  If Nintendo can survive as a company and not be number one, hey thats fine with me.  I just hope they don't go crazy and think they have to always under price the competition.  They are better than that.  They aren't Sega!

[Darc Requiem]

Well if the X-box price is dropped to $149.99 in the US Nintendo will have to follow suit. I still remember the gross error Sega made with the saturn. The N64 and PS dropped to 149.99 and Sega stayed at 199.99 for months. They were giving away two games at the $199.99 but they were still getting killed because they were still the higher priced console. I don't think Nintendo should make a drastic price drop maybe to like $124.99 and keep the free game promotion going. Or they could throw in ED has a second free game, its a great way to show that Nintendo isn't kiddie and the more people that play ED the more people will release that. Plus it would improves sales while getting rid of the excess ED stock. I mean I wont pretend to know better than Nintendo....they have 7 billion, I have zero. But I honestly think this would help with increasing the userbase of GC while changing peoples perception of it.

Darc Requiem

[ssj4_android]

I might actually buy XBOX if it gets dropped down to $150.

[Arbok]

Quote
Originally posted by: Illini4
Ok, this is what is called creating a Monopoly.  

I agree: lowering the cost you charge for a product to the point where you are actually losing money (but then they have been doing that sense day 1) to get the product out there in an attempt to drive out the competition is monopolistic practices at its best. To bad the US courts won't do a thing about it until it would be far too late. Also doubt Microsoft would get nailed for it, just by using more money they could probably buy their way out of the accusation.

[Kulock]

Quote
Originally posted by: PGC NewsBotLast year, when Sony cut the price of the PS2 down to $199, Microsoft was forced to follow suit,

Actually, didn't Sony first begin to hint at it, but Microsoft rushed their own price cut to beat them to it?

I really can't see the Nintendo Gamecube dropping lower than $129.99. Any lower than that and warning sirens start going off in people's heads, they would not take the Gamecube seriously if it was selling for $99. But ideas like the Zelda bundle coming out in Europe and America are great, more rebates and freebie offers could be used in conjunction with a $20 price cut, around E3 where it's known some major Nintendo games will probably be rearing their heads...

[Mingesium]

This price cut has more to due with Microsoft saving face. Reports are saying Microsoft will miss their forcast of 9 million for the fiscal year. Nintendo know they were going to miss their forcast and started free game bundle to help sales. It seems Microsoft is doing the same thing with the price cut.

[Djunknown]

hmm... The battle rages on.

The article didn't specifically say any price cuts here in the U.S.A. If you read the article, the XboX price is about 200 US dollars in the United Kingdom, and nearly 215 US dollars for the rest of Europe. Foreign technology is usually expensive overseas; if you go to Dell.com's European sites (and assuming you can read some of the languages) their prices are more expenisive than in the US, even though they offer roughly the same goods.

My analyisis shows Microsoft is trying to get the leg up in a terrority that is up for grabs; notice there's no mention of a price drop in Japan [I'm assuming lack of demand over there]. And as mentioned earlier, no need for Nintendo to tremble in fear.  The console may be cheaper, but what's more important are the games.