360 elite price cut

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MICROSOFT has cut the price of its high-end Xbox 360 Elite to step up the price war in the video game console market.

Barely a week after Sony announced a price drop for the Playstation 3 (PS3), Microsoft has announced its top-of-the-line console will undercut Sony's price by $50.

The $100 price drop will apply to the Xbox 360 Elite model in a move expected to start a new price war between the Xbox 360, Sony's PS3, and Nintendo's Wii.

It was announced for the US, UK, and Europe today, but will apply in Australia on September 22.

In Australia, the Xbox 360 Elite will now retail for $449 – or $50 less than Sony's new price, which was announced last week when the slim-model PS3 console was unveiled.

Adam Pollington, Microsoft's Xbox product marketing manager for Australia and New Zealand, told news.com.au the Xbox range would be different.

"We're moving away from three versions (of the console) to two versions in market," Mr Pollington said.

The entry-level Xbox Arcade will remain at $299 while the mid-level Pro model will be phased out at a current price of $399.

The only difference to the console packages will be the Elite's HDMI cable, which will no longer be bundled with the console.

"A majority of consumers don't seem to be utilising the HDMI cable that comes with the console," Mr Pollington said, adding that the number of different TV inputs and third-party cables were factors considered in the decision.

He also denied the price drop was a reaction to Sony's PS3 announcement.

"Things like this we plan months, sometimes years in advance," he said.

Earlier this week, Microsoft said it did not have plans for a slim-model Xbox console any time in the near future.

"It's not all about the console dropping price, it's also about the experience we can offer consumers - with Facebook and Twitter integration, plus HD movies soon coming to the console," Mr Pollington said.

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Similar article from the Australian :

Xbox $100 cheaper in Australia

Correspondents in San Francisco | August 28, 2009

update MICROSOFT has slashed the price of its high-end Xbox 360 video game console by $100 stepping up the price war in the video game console market.

Effective September 22, Microsoft will drop the price of the Xbox 360 Elite to $449 in Australia, just days after Sony cut the rival PlayStation 3 to $499 from $699.

Microsoft has sold about 700,000 Xbox 360 consoles in Australia while rival Sony has sold about 540,000 PlayStation 3 consoles.

On top of that customers buying an Xbox 360 Elite from the day of the price drop through to October 20th 2009 will receive a bonus copy of the highly anticipated blockbuster title Halo 3: ODST.

Analysts have said the cuts will pressure Nintendo to lower the price of its best-selling Wii console but for now the company is standing firm.

"We don't have such a plan," Nintendo spokesman Yasuhiro Minagawa said when asked about a price cut.

The price on the entry-level Xbox Arcade model will stay at $299, and Microsoft will phase out its mid-range Xbox Pro model, leaving it with two models. The Pro will sell for $399 until supplies run out.

Since PS3, Xbox and Wii are increasingly centerpieces of home entertainment, their sales can spur purchases of software, accessories and other media, and boost traffic at retailers.

And while the unit that runs Xbox is a small part of Microsoft's overall sales -- at about 11 per cent -- it is the company's biggest weapon in the battle to control entertainment in the living room.

Microsoft spokesman David Dennis said the price cut was in the works for some time and was not a response to Sony's cut. Rather, he said, the price reduction will attract new buyers and help simplify Microsoft's product mix for manufacturers and retailers as well as customers.

"It really makes the decision for consumers a lot easier," he said. "They're either price conscious and they gravitate toward the Arcade, or they want the full Xbox 360 experience."

In the US the Elite will now retail for $US299.99 ($357) while in Europe, the Elite price will shrink by 50 euros ($87) to 249.99 euros ($427), or 199.99 pounds ($388) in Britain. 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 more than 80 per cent in Europe.

Beyond console sales, the cuts by Microsoft and Sony should provide a lift to a broader gaming industry has been stuck in a slump brought on by a lack of big-name releases and a recession that has pinched consumer spending.

Indeed, game publishers like Activision Blizzard have clamored for price cuts, which often boost sales of software.

"Software makers should be quite happy about it," KBC Securities analyst Hiroshi Kamide said. "The industry should stage a bit of a recovery in the second half of this year."