MS could ship 3 million Xbox2 by december?

[EndR]

Goldman Sachs said it confirmed with Microsoft (nasdaq: MSFT - news - people ) that the company is unlikely to discontinue production of the Xbox videogame console with the launch of Xbox 2. Microsoft will provide a sneak peek of the Xbox 2 console on a television special on May 12 on MTV in North America and on May 13 internationally. "We had expected Xbox 2 to shown for the first time at the E3 videogaming conference in Los Angeles (May 17-20, 2005)," Goldman said. "This appears to be a tactical effort to show Xbox 2 before Sony (nyse: SNE - news - people ) demonstrates the PS3 [PlayStation 3 videogame console] at E3." The research firm, which rates Microsoft at "outperform," expects Xbox 2 to be available for retail sale in October or November at a retail price of about $249 to $299. Goldman said the Xbox console would cater to the lower-end of the consumer segment. The firm expects Microsoft to ship about 3 million units of the Xbox 2 worldwide in the December quarter. Sony is expected to debut the PS3 at E3, "although the product is not expected to be available in the U.S. until mid-2006 (perhaps a Japan launch in the fourth quarter of 2005 although more likely in the first quarter of 2006)," Goldman said.

http://www.forbes.com/markets/2005/04/12/0412automarketscan05.html?partner=yahoo&referrer=
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$249 would put some pressure on Sony. MS will sell the machine at a loss, but by having several ways for income (micro transactions, software and periphels stuff like the HD-addon, xboxlive fee) etc etc could help MS regain the losses quickly...

$299 sounds more realistic but MS seem adamant on selling as many units before the competition arrives and they will do that with a $249 price tag...

 

[Acert93]

$299 sounds more realistic but MS seem adamant on selling as many units before the competition arrives and they will do that with a $249 price tag...

$250 sounds like a very nice price point for a new console with what is rumored to be under the Xenon hood.

 

[mckmas8808]

I swear if M$ pulls that $249 console price off I just might buy one. I never planed on it being that I own only Sony videogame hardware.
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[satriales]

$249 is a bargain!!!

Here in the UK that is about £130. PS2 and Xbox are still £100 right now!

Obviously being in the UK the price won't convert like that instead we will be charged double the price: $249 = £249 according to Microsoft and Sony

Please be region free

 

[Titanio]

$250-300 is unsurprising. Anything more than $300 would go down like a lead balloon.

 

[Evil_Cloud]

$250-300 is unsurprising. Anything more than $300 would go down like a lead balloon.

Never seen the European PlayStation 2 (or Xbox in 2002) launch retail price of 500 euro, have you? How long did Sony stay at that pricepoint, something like 8 months?

 

[pc999]

Meybe XB2 dont cost much more to produce than XB cost today ?

 

[Carl B]

Meybe XB2 dont cost much more to produce than XB cost today ?

You are out of your mind.

Though admitedly with the large, essentially fixed costs Microsoft has carried this gen, the difference is probably a lot smaller than it should be.

 

[jvd]

I was under the impression that with 256 megs of ram ms wouldn't take a loss at 300$ they would have broken right about even . But now that there is alot more than 256 megs of ram they will take a loss at 300$ . Mabye a 100$ loss at 250$ isn't a big deal to them.

 

[Carl B]

But now that there is alot more than 256 megs of ram they will take a loss at 300$ .

Where'd you get this info from? (refering to the confirmed RAM>256)

 

[gurgi]

I think losses will be a big deal to MS this time around. Not that they won't take one on hardware, but I think they are rethinking thier bottomless wallet strategy for Xbox2, especially since it didn't really net them that much of a userbase considering thier investment.

 

[jvd]

its being passed around alot and has been told to me by some people who know

 

[karlotta]

? how much would ram cost if you can order it at a million units a shot? Not much. There should be a huge price break over the 1000min, or what ever it is for Dell.

 

[jvd]

? how much would ram cost if you can order it a a million units a shot? Not much.

Well if they got 512 megs of ram and payed only 1$ for that amount of ram it would cost 1 million per 1 million systems sold which is alot . FIgure its most likely going to be aroudn 50$ for ram that 50 million per 1 million units sold ..

I dunno about u but thats a shit load of money

 

[mckmas8808]

Great point jvd!!! I never really thought about it that way. Now that I realize that point the next xbox probably will be sold at a $100 plus loss. Not that M$ cares or anything.
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[Carl B]

I think losses will be a big deal to MS this time around. Not that they won't take one on hardware, but I think they are rethinking thier bottomless wallet strategy for Xbox2, especially since it didn't really net them that much of a userbase considering thier investment.

I agree 100% - you can kind of get a sense that Redmond isn't going to put up with another gen of straight losses from the Home Entertainment Division.

its being passed around alot and has been told to me by some people who know

Well, as vague as that is it's believable enough that I'll just go with it. 8) Now if you have any info one way or the other to confirm whether it's GDDR3 or not, that would be greatly appreciated. Still I think for the costs of the system, the CPU is going to constitue the highest single item going in to begin with.

? how much would ram cost if you can order it at a million units a shot? Not much. There should be a huge price break over the 1000min, or what ever it is for Dell.

Well that goes without saying, but since all the consoel makers are in the same boat on that one, it's best to stop thinking in terms of retail/wholesaler pricing altogether, and come at it from the angle that though everyone is paying significantly discounted rates for their RAM, that cost still amounts to something significant.

 

[Titanio]

$250-300 is unsurprising. Anything more than $300 would go down like a lead balloon.

Never seen the European PlayStation 2 (or Xbox in 2002) launch retail price of 500 euro, have you? How long did Sony stay at that pricepoint, something like 8 months?

I'm specifically talking about the US, of course Few venture above $300 - the PS2 was $300 at launch there, and that was considered a most expensive system to manufacture at the time.

Of course, we do get screwed over here in Europe, in ways unimaginable in the US. Though I'm pretty sure the PS2 wasn't €500..? I remember Xbox being €4xx but that was exceptional and surprising.

$250-300 certainly is unsurprising for the US. And I'd expect €250-300 here.

 

[jvd]

gurgi wrote:
I think losses will be a big deal to MS this time around. Not that they won't take one on hardware, but I think they are rethinking thier bottomless wallet strategy for Xbox2, especially since it didn't really net them that much of a userbase considering thier investment.


I agree 100% - you can kind of get a sense that Redmond isn't going to put up with another gen of straight losses from the Home Entertainment Division.

I don't think they care about loosing money strait out . They know they need to take a loss the first year or two as its the only way to make a console that will have good looking games 4 or 5 years down the road . What they are doing this gen is making hardawre that they can reduce in cost quickly . They are liscensing the chips so they are only paying a certian amount of money and they are free to jump from process to process and they reap any increases in yield that happen unlike last time. I think you will find that ms has a system that will drop in price faster than sonys will

Well, as vague as that is it's believable enough that I'll just go with it. Now if you have any info one way or the other to confirm whether it's GDDR3 or not, that would be greatly appreciated. Still I think for the costs of the system, the CPU is going to constitue the highest single item going in to begin with.

Beats me , i would guess its 700mhz gddr . Will be up there in 2005 but in 2007 it will be used in the low end cards and cost almost nothing (realitively) .

 

[Carl B]

I don't think they care about loosing money strait out . They know they need to take a loss the first year or two as its the only way to make a console that will have good looking games 4 or 5 years down the road . What they are doing this gen is making hardawre that they can reduce in cost quickly . They are liscensing the chips so they are only paying a certian amount of money and they are free to jump from process to process and they reap any increases in yield that happen unlike last time. I think you will find that ms has a system that will drop in price faster than sonys will

When I said 'straight losses,' I meant ending the generation with losses rather than profits. If XBox 2 doesn't turn decidedly profitable during this generation, be that in it's last year or whenever, I don't see there being an XBox 3.

Beats me , i would guess its 700mhz gddr . Will be up there in 2005 but in 2007 it will be used in the low end cards and cost almost nothing (realitively) .

Well, I hope it's better RAM than that.

 

[karlotta]

you can kind of get a sense that Redmond isn't going to put up with another gen of straight losses from the Home Entertainment Division.

Why? would they quit? They dont want to loose money, but its about being in every livingroom, they can "loose" a few billion over a long long time.

Well that goes without saying, but since all the consoel makers are in the same boat on that one, it's best to stop thinking in terms of retail/wholesaler pricing altogether, and come at it from the angle that though everyone is paying significantly discounted rates for their RAM, that cost still amounts to something significant.

Who is "all" sony is the one with "new RAM", Xbox2 will use off the shelf memory. There isnt much discounting if at all for Sony. Isnt hardware just for the sale of software, and tobe a billboard in your entertaiment center? the cost of hardware is a given to be loss.
MSRP will be 299. but Bestbuy and compusa will have "sales" at 249.