Microsoft drops price of Xbox 360 Elite by $100

Microsoft drops price of Xbox 360 Elite by $100

By SiliconIndia   |   Friday, 28 August 2009, 05:35 Hrs
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Bangalore: Microsoft has decided to slash the rates of its Xbox 360 consoles just months after Sony unveiled its smaller and cheaper Play Station 3 (PS3) models. Microsoft will be slashing prices of its high end Xbox 360 consoles by $100 in the U.S. and $71 in Europe. This will bring the console price down to $299.99 almost equal to PS3's newly slashed price of $299. Price on the entry-level Xbox Arcade model will stay at $199.99. Microsoft also plans to deplete its stock of Xbox Pro which is sold at $249.90, as it plans to phase it out. This will leave Microsoft with only two version of Xbox.

However, Microsoft spokesman David Dennis said to Reuters that the price cut has been in the works for some time, and was not a response to Sony's move last week. He says that the company hoped the price reduction would attract new buyers and simplify its product mix. "It really makes the decision for consumers a lot easier. They're either price conscious and they gravitate towards the Arcade or they want the full Xbox 360 experience."

Xbox 360 is the No. 2 console in the U.S., right behind Nintendo's Wii which sells for $249. But with the help of reduced prices Microsoft will be hoping to reach the No. 1 spot. The sales of Xbox have also picked up this year by 17 percent and it is the only console which is in positive territory. Nintendo has said that it has no plans to cut the price of its top-selling Wii console.

Chris Lewis, Head of Xbox Europe, said the cut would help Microsoft match or beat its 2008 performance, when it increased unit sales of Xboxes by more than 80 percent in Europe. "We expect them to be at least as good if not better," Lewis said. "I do believe there will be a higher level of economic confidence than was the case last year."

Many game publishers like Activision Blizzard have been requesting for price cuts in console which will help them boost sales of software by increasing the installed base. Gaming industry at least now has a reason to cheer after months of slump due to lack of any big name releases and the drop in the sales due to recession.