Xbox 360 price drop info, with pics

[jpimgt]

My predictions are MS either phasing out the arcade after the $199 drop because they can't really be making money on those, OR let developers use the HDD so the $199 owners would have to buy the hard drive to play the new games, putting the total right back at $299, because lack of HDD is really hurting the devs and MS should do something about that.

For Sony, I don't see a price cut, since they would probably lose a lot of money if they matched it to $299, and I doubt $349 makes much of a difference from $399. They have to at least wait till the GPU is 65nm before a price cut, which should be by December, I think. So I foresee Sony bundling a game, or even better, one game and one blu-ray (from Sony owned game&movie studios of course) with the $399 SKU so they can say $60+$40 dollar value compete against the $299 Pro.

[IceNine]

Originally Posted by jpimgt

My predictions are MS either phasing out the arcade after the $199 drop because they can't really be making money on those, OR let developers use the HDD so the $199 owners would have to buy the hard drive to play the new games, putting the total right back at $299, because lack of HDD is really hurting the devs and MS should do something about that.

For Sony, I don't see a price cut, since they would probably lose a lot of money if they matched it to $299, and I doubt $349 makes much of a difference from $399. They have to at least wait till the GPU is 65nm before a price cut, which should be by December, I think. So I foresee Sony bundling a game, or even better, one game and one blu-ray (from Sony owned game&movie studios of course) with the $399 SKU so they can say $60+$40 dollar value compete against the $299 Pro.

Sony doesn't need to do anything. The PS3 is selling very well as a Blu-ray player and it is the best price/performance player on the market.

[Treadstone]

Why would M$ drop the arcade version? This is not a firesale...

[hdinred]

Originally Posted by Treadstone

Why would M$ drop the arcade version? This is not a firesale...

They’re not dropping the arcade SKU. Microsoft’s Shane Kim said in July:

The Xbox 360 Arcade is more successful than many people credit. We’ve seen it grow to be a meaningful part of the overall portfolio of sales and I believe as we drive towards more mass market pricing, as we add mass market mainstream consumer services, the Xbox 360 Arcade is going to continue to grow to be a bigger part in terms of our sales.

[Paging DR B]

Originally Posted by BBM128

Sure they can. Remember, ultimately, it's the software that rakes in the money, not the hardware. Sony could concievably drop the price $50 and still post a profit at the end of the quarter through software sales. Though to be honest, they should just bite the bullet and drop it $75 to $100. That'd be pretty awesome, actually.

As 2008 has proven, nothing is impossible. Afterall, the PS3 has a system seller, AAA exclusive, it's outsold the 360 in it's strongest market thus far this year, and the 360 has beaten the PS3 in Japan at least one week of sales this year.

If Sony wishes to remain competitive for the holiday season (and I have no doubt that they do), they'll try to counter the price drop. I'd almost bet money on it.

If sony drops the price of the best bluray player to $50, i could only imagine a crazy lawsuit from the likes of panasonic, LG, samsung, pioneer, etc.. because then they're left out in the cold and losing millions on hardware they developed.

[IceNine]

Originally Posted by kickingtotalass

Let them know you've been waiting forever, I had a box 1 biz day after the call, had ANOTHER xbox back 3 biz days later. I got RRoD on a thursday though, didn't call till friday so I got them on a monday. (you need a case ticket first)

They will hook you up. They're american!

I talked to an American guy today and he said that he would send a box via FedEx overnight. It was nearly 5:00 when I talked to him, so I might not see it until Wednesday. He said that he is going to keep checking on and would call me Wednesday to make sure that the box arrived.

The American guys give much better customer service.

Thanks for pointing out the number.

[Darkfalz]

Originally Posted by jpimgt

My predictions are MS either phasing out the arcade after the $199 drop because they can't really be making money on those, OR let developers use the HDD so the $199 owners would have to buy the hard drive to play the new games, putting the total right back at $299, because lack of HDD is really hurting the devs and MS should do something about that.

For Sony, I don't see a price cut, since they would probably lose a lot of money if they matched it to $299, and I doubt $349 makes much of a difference from $399. They have to at least wait till the GPU is 65nm before a price cut, which should be by December, I think. So I foresee Sony bundling a game, or even better, one game and one blu-ray (from Sony owned game&movie studios of course) with the $399 SKU so they can say $60+$40 dollar value compete against the $299 Pro.

To build the 360 console alone (without hard drive) cost roughly $260 nearly two year ago (Nov 2006).

Since then, the 360 has had several hardware revisions - ALL of which made the unit cost less to manufacture. The CPU's cost alone has dropped by more than half since 2006... and both the CPU and GPU are now being manufactured with the 65nm manfacturing process. Cost reduced controllers, hard drives, cases, CPU's, GPU's, motherboards, etc, etc, etc all mean that there's not really any evidence which supports the theory that MS couldn't be breaking even (if not be profitable) when selling an arcade at $199, as that's only $60 LESS than what it cost to manufature a 360 two years ago.

MS knew this generation they'd have to cost reduce massively, and they have. From the moment 360 hit the shelves, MS has worked hard to save costs. In the first year alone, MS dropped the manufacturing cost by 40%.

Furthermore, Merrill Lynch estimates that after THREE YEARS systems usually cost roughly 35% of what they initially cost to manufacture, and initial estimates put 360 at around $525 (and that was for everything - not just the console)... which means by their estimates, a 360 PREMIUM should be sitting at around $190 to manufacture... for a PREMIUM.

Just some food for thought...

[michealo]

perhaps they should have spent those manufacturing costs a bit better before launching

[maley]

Originally Posted by michealo

perhaps they should have spent those manufacturing costs a bit better before launching

Yea I'm sure whoever was the mastermind (or how many) behind the manufacturing decision got fired. Doesn't matter what the evidence looked like before, you cost MS $1 billion + in warranty and other costs. You don't keep a job after that.

edit: And I'd wager that the RRoD has kept Sony in the competition this gen. When mainstream news sources are running stories about how crappy a console is built then parents don't buy your system for their kids. Kept me from ever buying one, and well...I just don't need one now.

[hdinred]

Originally Posted by maley

edit: And I'd wager that the RRoD has kept Sony in the competition this gen. When mainstream news sources are running stories about how crappy a console is built then parents don't buy your system for their kids. Kept me from ever buying one, and well...I just don't need one now.

Doesn’t seem so. When the news broke last July, Xbox 360 still outsold PS3 throughout 2007 (in the US).

[jpimgt]

Originally Posted by Darkfalz

To build the 360 console alone (without hard drive) cost roughly $260 nearly two year ago (Nov 2006).

Since then, the 360 has had several hardware revisions - ALL of which made the unit cost less to manufacture. The CPU's cost alone has dropped by more than half since 2006... and both the CPU and GPU are now being manufactured with the 65nm manfacturing process. Cost reduced controllers, hard drives, cases, CPU's, GPU's, motherboards, etc, etc, etc all mean that there's not really any evidence which supports the theory that MS couldn't be breaking even (if not be profitable) when selling an arcade at $199, as that's only $60 LESS than what it cost to manufature a 360 two years ago.

MS knew this generation they'd have to cost reduce massively, and they have. From the moment 360 hit the shelves, MS has worked hard to save costs. In the first year alone, MS dropped the manufacturing cost by 40%.

Furthermore, Merrill Lynch estimates that after THREE YEARS systems usually cost roughly 35% of what they initially cost to manufacture, and initial estimates put 360 at around $525 (and that was for everything - not just the console)... which means by their estimates, a 360 PREMIUM should be sitting at around $190 to manufacture... for a PREMIUM.

Just some food for thought...

What you fail to grasp is those are all estimates and production cost estimates are NEVER accurate. They are as reliable as vgchartz.

[Master X]

I should have pics of the ad later this week.

[ArronC07]

Originally Posted by Darkfalz

To build the 360 console alone (without hard drive) cost roughly $260 nearly two year ago (Nov 2006).

Since then, the 360 has had several hardware revisions - ALL of which made the unit cost less to manufacture. The CPU's cost alone has dropped by more than half since 2006... and both the CPU and GPU are now being manufactured with the 65nm manfacturing process. Cost reduced controllers, hard drives, cases, CPU's, GPU's, motherboards, etc, etc, etc all mean that there's not really any evidence which supports the theory that MS couldn't be breaking even (if not be profitable) when selling an arcade at $199, as that's only $60 LESS than what it cost to manufature a 360 two years ago.

MS knew this generation they'd have to cost reduce massively, and they have. From the moment 360 hit the shelves, MS has worked hard to save costs. In the first year alone, MS dropped the manufacturing cost by 40%.

Furthermore, Merrill Lynch estimates that after THREE YEARS systems usually cost roughly 35% of what they initially cost to manufacture, and initial estimates put 360 at around $525 (and that was for everything - not just the console)... which means by their estimates, a 360 PREMIUM should be sitting at around $190 to manufacture... for a PREMIUM.

Just some food for thought...

Take your cost reduction and add $1 billion.

[Darkfalz]

Originally Posted by jpimgt

What you fail to grasp is those are all estimates and production cost estimates are NEVER accurate. They are as reliable as vgchartz.

Manufacturing costs for hardware are actually quite easy (and fairly accurate) to estimate... so there's no realy reason to assume they're off by more than 5%-10%.

[Darkfalz]

Originally Posted by ArronC07

Take your cost reduction and add $1 billion.

..still cheaper than PS3's 3 billion in losses...

...and the losses it's still incurring...