Microsoft
The $300 price for the Xbox 360 Elite console, previously $400, is effective immediately, while a less powerful system called Pro that had cost $300 will be discontinued, David Dennis, a Microsoft spokesman, said in an interview. The company will continue selling a $200 model, he said.
The moves by Sony and Redmond, Washington-based Microsoft may increase pressure on Nintendo Co. to reduce the price of its $250 Wii. The Kyoto, Japan-based company has maintained the price of its top-selling Wii player since it was introduced in November 2006. The system has sold more than 50 million units worldwide, according to the company.
“If the time is right for Sony to cut the price, it probably means the time is right for Microsoft,” said Colin Sebastian, a San Francisco-based analyst with Lazard Capital Markets, who was briefed by Microsoft. “Clearly the industry needs a shot in the arm, and this goes a long way to do that.”
Game publishers and retailers have called on the console makers to reduce prices to drive new sales amid the recession. Through July, U.S. video-game sales have fallen 14 percent this year to $8.16 billion, according to NPD Group Inc., the Port Washington, New York-based market researcher.
Wii Sales
In July, Wii sales tumbled 55 percent and those of Sonys PS3 dropped 46 percent, NPD said. Microsoft Xbox 360 sales fell 1 percent.
The price cut may help increase Xbox sales in the back-to- school shopping season and ahead of next months release of a new version of Microsofts top-selling game “Halo,” Sebastian said.
Sony, based in Tokyo, lowered the price of the PlayStation 3 by $100 to $300 last week, a 25 percent reduction.
Microsoft, the only console maker to increase U.S. sales this year, has sold more than 30 million Xbox 360 machines since the player was introduced in May 2005, Dennis said. Sony said it has sold about 24 million PS3s worldwide since 2006.
Microsoft fell 9 cents to $24.55 yesterday in Nasdaq Stock Market trading. The shares have risen 26 percent this year. U.S. shares of Sony rose 19 cents to $27.03 on the New York Stock Exchange and have gained 24 percent this year. Nintendo rose 280 yen to 24,350 yen in Osaka on Aug. 26 and has fallen 28 percent.