Business Approach Comparison Sony PS4 and Microsoft Xbox

[Cyan]

How quickly can they do a price drop without:

A: Looking desperate?
B: Upsetting the early adopters who just paid $500 for their system?

If there are systems sitting on shelves come January a la the PS3 and the PS4 is still scarce then they have a real problem.

If they were looking desperate they would announce a price drop during the months after the E3.

A price drop is most likely to happen sooner than later. The console doesn't cost what most people expect from a console, that's the reality of things.

Even if a company like Sony or Microsoft announced a price drop during the Christmas, personally I wouldn't be upset as an early adopter because I paid a price that seemed fair to me and got the console before most people, which is a perk.

Take into account that here in Europe we are getting a game for free with the console. In many cases -if you pre-ordered the console at Game during the summer months- you get two games for free -I got Fifa 14 and Ryse-.

Other deals related to the reserves of the console feature a game and the second controller for free. At 500€ that doesn't sound that bad, not to mention the 2 years warranty just in case -although they said that the Xbox One was created to be capable of having the power turned on for 10 years, 24 hours a day-.

On a different note, the Xbox team has hired Jeff Rubenstein, which seems to be a logistics move.

http://majornelson.com/2013/11/12/welcome-jeff-rubenstein-to-the-xbox-team/

 

[dobwal]

But even then, MS is in a tough spot because they need the press now, at launch. But now, at launch, they will be supply constrained and they've priced themselves out of that market anyway.

How does one accomplish a constrained supply while pricing themselves out the market.

"We can't make enough of these consoles that nobody wants!!!"

And given that very few here predicted the Wii with a user base of 100 million and a 360 with 80 million in unit sales. I think that if any group here is right about the success or failure of the Xbox one, it more happenstance then the ability to reliably understand the market.

 

[RancidLunchmeat]

How does one accomplish a constrained supply while pricing themselves out the market.

"We can't make enough of these consoles that nobody wants!!!"

I assume you're joking here, but just to clarify for others that might be confused:

MS needs the GMA and Today Show and Ellen press NOW, at launch. However, like every console that isn't based on 8 year old tech, it will be supply constrained. Additionally, the market that they are advertising to with GMA, etc aren't going to be interested in purchasing the console, no matter how neat they think it is, at $500.

No where did I say nobody wants the console. I said that they won't be able to make enough consoles even for those willing to buy it at $500, and for those "new comers" (which is what we were discussing) that might be gained through the early morning shows catering to housewives, won't be interested at $500. Not that they don't want it. They just won't purchase it at $500.

I hope that clears it up.

 

[babybumb]

If i were Sony i would ship 2M to NA and only 1M Europe this year.

That would put MS in an awkard position going to next year.. they need to convince quite a few influencers to buy a second console and not tell their associates to just get a PS4

 

[blakjedi]

If i were Sony i would ship 2M to NA and only 1M Europe this year.

That would put MS in an awkard position going to next year.. they need to convince quite a few influencers to buy a second console and not tell their associates to just get a PS4

amazon.com still has PlayStation bundles still in stock when I last checked. starting around $639.

 

[betan]

amazon.com still has PlayStation bundles still in stock when I last checked. starting around $639.

Which amazon official bundle is $639? A link would be nice.

 

[blakjedi]

Which amazon official bundle is $639? A link would be nice.

it was a launch edition and they had 10 of them. seems they're gone now

 

[Cyan]

I am not totally sure if this goes here, but the news is that Apple have purchased the company which helped Microsoft to create Kinect.

http://www.neowin.net/news/report-apple-buys-the-company-that-helped-microsoft-create-kinect

 

[patsu]

If true, probably also for the IP before Apple launch their own. Intel is also working on something.

 

[wco81]

wow, imagine if they did something like this for a TV product.

MS and Apple have a cross-licensing deal so they haven't sued each other for patents.

But if Apple got a hit TV product using a motion sensor while the X1 doesn't sell beyond the console market, would MS take that lying down?

 

[patsu]

Oh stop rocking the freaking B3D boat. I don't know if we can survive the next 2 weeks.

 

[AlphaWolf]

But if Apple got a hit TV product using a motion sensor while the X1 doesn't sell beyond the console market, would MS take that lying down?

I think voice control is much more important than motion for the TV market, and that ship has already sailed with a number of voice controlled TVs and STB's already on the market.

 

[dobwal]

I assume you're joking here, but just to clarify for others that might be confused:

MS needs the GMA and Today Show and Ellen press NOW, at launch. However, like every console that isn't based on 8 year old tech, it will be supply constrained. Additionally, the market that they are advertising to with GMA, etc aren't going to be interested in purchasing the console, no matter how neat they think it is, at $500.

No where did I say nobody wants the console. I said that they won't be able to make enough consoles even for those willing to buy it at $500, and for those "new comers" (which is what we were discussing) that might be gained through the early morning shows catering to housewives, won't be interested at $500. Not that they don't want it. They just won't purchase it at $500.

I hope that clears it up.

It doesn't help that your statements tend to be contradictory.

There always exists a limitation to production regardless if launch or not. For supplies to be constrained there has to exist an inability to meet demand.

And why are you going to state that MS needs GMA and Ellen if you are going to later conclude that the housewives that watch these shows aren't going to be interested in the Xbox One at $500.

You don't go to show off wares at shows like these just to convince new comers to buy your products. You go to shows like these because women have significant control over household spending in the US and a play a major factor in a lot of CE purchases (there are even studies that state women make the majority of consumer electronic purchases as of 2012-2013). MS and others show off wares on these shows with the belief that mom or wife might be easier to convince if vendors are able to create a positive impression with these female purse string holders.

Furthermore, who do you think does the majority of the gift shopping during the holidays?

 

[warb]

I think voice control is much more important than motion for the TV market, and that ship has already sailed with a number of voice controlled TVs and STB's already on the market.

It hasn't sailed very far. It will probably sail further on the Xboat.

 

[dobwal]

I think voice control is much more important than motion for the TV market, and that ship has already sailed with a number of voice controlled TVs and STB's already on the market.

I think you are right.

"'I'd like to create an integrated television set that is completely easy to use,' he told me. 'It would be seamlessly synced with all of your devices and with iCloud.' No longer would users have to fiddle with complex remotes for DVD players and cable channels. 'It will have the simplest user interface you could imagine. I finally cracked it.' Steve Jobs

I think Siri is what Apple has planned for TVs and is basically using the iphone as a incubator to generate data to make it robust enough for TV use.

There is nothing simplier than voice in terms of a user interface. Its impracticality has always being its never been robust enough to be a primary interface.

 

[blakjedi]

I remember reading a story on the development of Kinect 2. MS doesn't use the technology of that company in Kinect2

 

[Zaphod]

Paul Thurrott (in a bit of a "the swan song of the gaming consoles" piece) have restated the prediction of an upcoming game-less Xbox.

As I exclusively reported previously, Microsoft originally planned to ship a second Xbox One unit focused solely on entertainment, but temporarily killed this effort earlier this year. That device is still coming, will be much less expensive, and will dramatically outsell the Xbox One [my bold]. Which of course is why they held off.

What I find curious is the unqualified success prediction. It's not as if that market is devoid of competition either (it's nose-bleedingly crowded), so some people are obviously bullish on those qualities of the system.

 

[Shifty Geezer]

Paul Thurrott (in a bit of a "the swan song of the gaming consoles" piece) have restated the prediction of an upcoming game-less Xbox.

That makes a lot of sense to me as I've described in the Xbox thread. A gameless Kinect CE device at a much lower price can reach a far wider market. Although that, of course, is not going to be an Xbox console.

What I find curious is the unqualified success prediction. It's not as if that market is devoid of competition either (it's nose-bleedingly crowded), so some people are obviously bullish on those qualities of the system.

If it costs half the price and appeals to a larger segment, it'll outsell the console. That's a pretty natural conclusion. They only way that couldn't be true is if interest in the entertainment features was very low and the reason to buy XB1 was the gaming aspect as well or exclusively. If the entertainment features have significant value, they'll be wanted by a large segment of the populace at a lower price which is what a standalone box will provide. That'd explain why reaching TV audiences is important for launch. Show Joe Consumer this fabulous next-gen CE interface. Have them wanting it but not willing to spend $500 on it. Sell $500 consoles to Joe Gamer. Release a CE device and suddenly Joe Consumer can have $500 worth of CE entertainment device for $200. That pent up desire you've established will be coupled with an apparent bargain and help explode demand.

 

[Nesh]

If it costs half the price and appeals to a larger segment, it'll outsell the console. That's a pretty natural conclusion. They only way that couldn't be true is if interest in the entertainment features was very low and the reason to buy XB1 was the gaming aspect as well or exclusively. If the entertainment features have significant value, they'll be wanted by a large segment of the populace at a lower price which is what a standalone box will provide. That'd explain why reaching TV audiences is important for launch. Show Joe Consumer this fabulous next-gen CE interface. Have them wanting it but not willing to spend $500 on it. Sell $500 consoles to Joe Gamer. Release a CE device and suddenly Joe Consumer can have $500 worth of CE entertainment device for $200. That pent up desire you've established will be coupled with an apparent bargain and help explode demand.

Exactly

 

[Michellstar]

Well, we saw that coming, the sad thing as gamers, is that the cheap gaming console is not coming, or the powerfull one, for that matter.

In other words, whoever wants to play with XO has to pay for the burden of that XBTV, and it´s not cheap