Xbox One’s Price Cut Is Not Only For Ramping Up Sales: Microsoft

Microsoft’s Yusuf Mehdi explains the reason behind the price cut.

Posted By | On 13th, May. 2014 Under News | Follow This Author @GamingBoltTweet


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After much criticism and several twisty decisions, Microsoft has finally decided that they will be decoupling Kinect from the Xbox One. This movie immediately makes the console much more attractive as it’s now evenly priced with the PlayStation 4 at $399. The new SKU will hit retail this June.

Some may state that this is a desperate move on Microsoft’s part to improve sales, however according to Xbox marketing lead Yusuf Mehdi, the price cut isn’t just too ramp up sales.

“For us, it has not really been about that,” he said to Endgadget. “We have 80-plus million Xbox 360 users today who want an Xbox One, and many of them tell us, ‘For me, it’s an affordability issue. I’m gonna get there, it’s just a question of time. If you make it more affordable, then I’ll upgrade faster.’ So this is an opportunity to really make it easier for them to get there at their pace.”

I find this rather interesting as Microsoft has continuously listened to consumer feedback and has made some drastic changes to their original controversial DRM vision. This really begs the question why Microsoft advertised the Kinect as a must have in the first place?

Do you agree with Microsoft’s decision to cut down the price or do you think this is a slap in the face of people who bought an Xbox One with Kinect? Sound off in the comments section below.


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  • Graf Ulrich 88

    This isn’t for offering more choices for gamers, it’s that Sony has a 3 million plus lead already and MS is doing it’s best to slow the bleeding. Sony should just announce a $40 or $50 price drop for the PS4 and also price drops for the PS3 and Vita, Vita memory cards. Sony can’t let up now, it’s personal ever since MS use to mock them during the last generation. Well who’s laughing now MS. The gamers have spoken and the PS4 is now the lead console in NA and the world.
    Cheers!!!
    Graf

    • Johnny

      Sony is slowly bleeding out and can’t do price cuts. They can’t afford to do it, I just read there ceo is taking a 50% pay cut.

    • ps4lol

      Sony’s 1st parties are ALL working on PS4 games. The gaming division is making a profit and is well funded. The gaming division and first party studios are well funded and making a profit. During the quarter ending 31st December 2013 the Game business made a profit of $172m off the back of an impressive 64.6 per cent rise in sales year on year.

      PS4 has the superior version of all console AAA multiplats, The Order, Driveclub, MLB 14: The Show, Deep Down, Uncharted 4, TLOU Remake, more dev support including indies, free to play games and MMOs like FFXIV and Warframe, and unannounced 1st party games (Gran Turismo, God of War, Media Molecule, Quantic Dream, etc.) Titanfall 2 and future 3rd party games will almost certainly be on PS4.

      Recently Sony has filed trademarks or had leaks for no less than 6 games. Entwined, Kill Strain, Blood Borne, Dark Chronicles, Project Beast and Guns Up. Expect a big E3 reveal of new games.

      Sony is selling or splitting off their lossy businesses (Vaio, TVs) and focusing on their profitable divisions. This means they’ll soon cut their losses and start turning a profit. You should be worried if Sony WASN’T cutting those losing divisions, but they’re making the right business decisions. They won’t ever be an empire again but they aren’t going under.

      The gaming division and first party studios are well funded and making a profit. During the quarter ending 31st December 2013 the Game business made a profit of $172m off the back of an impressive 64.6 per cent rise in sales year on year. Sony is in for a year or two of losses and restructuring, then provided their profitable divisions stay profitable, they’ll be on solid ground.

      Sony is still worth 18.5 billion. They just aren’t bringing in enough revenue or profits to bring that number up, and for a time, and probably for a few quarters here or there for the next few years, they might lose money. They also obviously have working capital, because they have games in development right now, and are able to market their newest system and do what they have to do to sell their products. If Sony were on the brink of bankruptcy, we wouldn’t be seeing AAA game announcements with budgets ranging from $50-100 million dollars. If they were on the brink of bankruptcy, they wouldn’t be buying Gaikai, or investing in new tech such as Morpheus or the PS4. PS4 will make a net profit, and Sony won’t go bankrupt.

      Sony Game, Financial Services, Devices, Music, Mobile Products & Communications, and Pictures are all profitable divisions. They aren’t going anywhere, sorry.

      Sony’s market cap is 18.65 billion as of today (2014).
      Market cap in 2013 was 17.6 billion it has gone up since then.
      Sony is ranked #80 in world as the most valuable brand 2013.

      Sony is ranked #506 in the global 2000
      #87 in Sales
      #171 in Assets
      #547 in Market value
      78.52 billion dollars in sales in 2013

    • Johnny

      Sony slashes earnings guidance after nightmare losses

      http://nypost.com/2014/05/01/sony-slashes-earnings-guidance-after-nightmare-losses/

      Sony Revises Expected Loss to $6.4 Billion

      http://mobile.nytimes.com/2012/04/11/business/global/sony-revises-expected-loss-to-6-4-billion.html

      Sony CEO’s Credibility Takes Hit With $1.1 Billion Loss Forecasthttp://mobile.businessweek.com/news/2014-02-06/sony-ceo-credibility-takes-hit-with-1-dot-1-billion-loss-forecast

      Sony Corp. (6758) forecast a $1.1 billion loss and will cut 5,000 more jobs as Chief Executive Officer Kazuo Hirai sells its personal-computer business and splits the television division into a separate unit

      http://mobile.bloomberg.com/news/2014-02-06/sony-forecasts-annual-loss-as-hirai-turnaround-stalls-on-tvs.html

    • ps4lol

      You’re going to be eating mountains of crow as Sony is still around 10 years from now, not bankrupt. You LOVE eating crow, it’s your main diet, after all you haven’t made a single right sales or hardware prediction ever.

      You seem upset at PS4’s stronger hardware, ~3 million sales lead, large number of 1st party studios, and larger developer support. It must suck that most or all of your claims and predictions turn out wrong.

      You don’t understand business, sales, or hardware specs, all you can do is fling feces and scream “XBOX WON!!1” like a rabid animal. Microsoft fanboy shills don’t love their console they just hate the success of others.

      PS4 will have the graphics advantage the entire gen. PS4 hardware and software will outsell Xbox globally the entire gen. PS4 will have more dev support and more 1st party games the entire gen. PS4 will make a net profit, and Sony won’t go bankrupt.

      Keep crying and shilling while everyone else ignores you and keeps buying PS4s. Those 800,000+ Xboxes rotting on shelves must hurt. You’re an inept minority of asshurt microsoft fanboys lying and screaming to no effect.

    • Johnny

      Sony isn’t going anywhere and neither is the playstation. That wasn’t the point, the point is they aren’t able to to as much financially as much as they used to because they don’t have the capital to do so.

    • crizz1066

      And selling off buildings and unprofitable devions means, the cash balance will come back sooner. Also with ps4 a very strong product globally it won’t have problems with people wanting to work with them

    • Johnny

      For sure they are doing all the right things and cutting the fat. Just atm they are taking heavy losses due to stiff competition in all of there other divisions.

    • crizz1066

      True and slimming down to concentrate on areas which are still profitable for them makes them much more able to change adapt and be more attacking. As a company becomes bigger it becomes risk averse, slow to innovate and stagnate. Look at Apple, have they truly done anything new and amazing in last few years???? The fact is there are still X1s in huge piles and I dont believe price is the only reason for this.
      So Kinect finally been removed, sooner than I thought it would tbh.

    • Johnny

      Me to, I would have thought they would have waited until 2015 at least but I guess Phil felt different and did the right thing.

    • crizz1066

      I might be biassed but this being done so soon I see as X1 is still having problems being sold. As its 2 fingers to anyone developing for the kinect. Plus whose going to want to bother to do the extra handwork to add kinectablility (if thats a word) It just highlights how out of touch M$ has been. Perhaps Phil can turn it round he did work for Sony so hopefully some of their magichas rubbed off 😉

    • Johnny

      Btw you put a lot of words in my mouth and post things I haven’t said. My hole argument is all about the xone not being nearly as bad as you make it out to be. PS4 is great and you should go enjoy it and not obsess over something that you don’t own and will never own and have no interest in other then hateing on it.

    • crizz1066

      Brilliant, wish I could be bothered to do the work, for such a concise view point!

    • Johnny

      Here it is. Sony CEO Among 40 Execs To Give Up Bonuses As Company Struggles

      http://m.huffpost.com/us/entry/3194446/

    • ps4lol

      Sony doesn’t have to drop the price. They have a 3 million and growing sales lead.

    • ”Say No More”

      Sony can’t afford to do that, considering they’re already laid off thousands of employees, sold their PC division, spun off their TV division and are projecting a $1.3B. loss this year.

  • Michel Simmons

    If they really wanna increase sales undercut Sony by selling kinect less X1 at $349 a kinect version for $449 and make a white version. Last thing make a new sku with user upgradable HDD.

  • Spencer

    So how is “helping customers buy Xbox one faster ” NOT about sales?


 

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