Xbox 360 price drops by $50

[borowki]

It doesn't matter how many millions they order, someone's keeping a manufacturing line churning out these anachronistic drives just for them, and it likely comes at a price. Even 40GB has had its time come and go. These drives (20GB, 40GB, 60GB, 80GB) are *all* single platter drives - it's simply the platters themselves that differ.

Just because the storage capacity is anachronistic doesn't mean the drive has to be. The HDs used in the X360 are made to order by Seagate. They could conceivable use the same parts as higher capacity ones. I remember reading an interview of the Seagate CEO in BusinessWeek, where he said that their cheapest platform is a 80GB single platter drive. By now it might be 120GB.

According to Takahashi, the quote Microsoft got from Seagate was $30 to$40--around the same as the cost of the drive in the original Xbox towards the end of the cycle.

 

[Arwin]

I have no idea whether it means anything, but the Premium is back as being the most popular 360 here. It remains difficult to see how popular it is, because of the multiple SKUs. Also, the PS3 has left the top two for the first time I've looked at this list in a month.

http://www.amazon.com/gp/bestsellers/videogames/ref=pd_ts_pg_1/102-2419145-6589769?ie=UTF8&pg=1

I saw a significant change in this list for the PS3 after the pricedrop, so I'm interested to see whether or not the pricedrop for the 360 has a similar effect. It seems harder to detect though because of the multiple SKUs.

 

[Carl B]

Just because the storage capacity is anachronistic doesn't mean the drive has to be. The HDs used in the X360 are made to order by Seagate. They could conceivable use the same parts as higher capacity ones. I remember reading an interview of the Seagate CEO in BusinessWeek, where he said that their cheapest platform is a 80GB single platter drive. By now it might be 120GB.

According to Takahashi, the quote Microsoft got from Seagate was $30 to$40--around the same as the cost of the drive in the original Xbox towards the end of the cycle.

Borowki I don't know if you realize, but this post further reinforces the points I was making.

1) That the mechanical components of the drive are the same; it is a Seagate single-platter drive - only the platter density differs (and the platter used here is 'ancient')

2) That the drive is probably in the $30+ range

These are the exact reasons why MS should be able to increase the drive capacity at no real cost to them - because if NewEgg is able to source and sell 60GB drives for under $50, what in the world is MS still doing stuck at 20GB? I'll tell you one thing - whatever their arrangement with Seagate, those 20GB drives aren't going to be getting any cheaper for them, whereas the higher density single-platters can likely already be had for the same cost.

 

[dobwal]

I don't see why this have to be the case. Even MS's own license covers all of its peripherals, more than likely it doesn't cover 3rd party hardware, as MS cannot be stupid enough to charge extra $20 for the pretty much same peripheral available to PS3.

That might be relevant if you could play PS3 GH2 with the PS3 Guitar on the 360, but you can't. $20.00 less PS3 peripheral is not going to convince alot of people to buy a $500 dollar console instead of a $350.00 console.

 

[Arwin]

Maybe not. But together with all those other peripheral stuff, it may convince at least a few. It puts me off, anyway. If I could just get a 360 and use my existing wheel, for instance, then that'd make the machine significantly cheaper to me.

 

[dobwal]

Borowki I don't know if you realize, but this post further reinforces the points I was making.

1) That the mechanical components of the drive are the same; it is a Seagate single-platter drive - only the platter density differs (and the platter used here is 'ancient')

2) That the drive is probably in the $30+ range

These are the exact reasons why MS should be able to increase the drive capacity at no real cost to them - because if NewEgg is able to source and sell 60GB drives for under $50, what in the world is MS still doing stuck at 20GB? I'll tell you one thing - whatever their arrangement with Seagate, those 20GB drives aren't going to be getting any cheaper for them, whereas the higher density single-platters can likely already be had for the same cost.

Maybe the cost per unit given to MS by Seagate was dependent on a certain volume? It seems most likely the case because cost per unit from a manufacturer on almost any product is based on the volume of the order.

 

[DJ12]

I personally think they've jumped too soon.

They should've waited at least another month to see if the sales of PS3 continued at the rate they were last month.

$50 isn't going to really bringing them new customers in my opinion. It seems like a knee jerk reaction to the PS3 doing decent numbers for the first time since launch.

 

[betan]

That might be relevant if you could play PS3 GH2 with the PS3 Guitar on the 360, but you can't. $20.00 less PS3 peripheral is not going to convince alot of people to buy a $500 dollar console instead of a $350.00 console.

May I remind you MS's policy on DLC that is freely available to other platform(s)? They even reimbursed Vegas maps IIRC.

Otherwise would it convince a lot of people to buy a $500 dollar console instead?
Who knows.

But I am sure they wouldn't want all upcoming peripherals to be $20 more than the other platform.

 

[pipo]

But I am sure they wouldn't want all upcoming peripherals to be $20 more than the other platform.

360 controllers are cheaper, HD cables are included and the 64MB card is almost as expensive as the current 8MB PS2 type.

Your point was?

 

[dobwal]

I personally think they've jumped too soon.

They should've waited at least another month to see if the sales of PS3 continued at the rate they were last month.

$50 isn't going to really bringing them new customers in my opinion. It seems like a knee jerk reaction to the PS3 doing decent numbers for the first time since launch.

Given that most price cuts are responded to within days (1 or 2), the timing of this cut would seem rather conservative.

 

[betan]

360 controllers are cheaper, HD cables are included and the 64MB card is almost as expensive as the current 8MB PS2 type.

Your point was?

Well, whatever my point was, it had nothing to do with your reply, unless of course you are saying Microsoft would want functionally equivalent peripherals to be $20 more expensive.

 

[jb]

I'd like to the the fly on the wall over at M$ and listen in to what their plans are regaurding this. For most of us it seems silly not to go for the market share with a big price cut now to go with their strong fall/winter lineup. You would think some there would know this as well. What are M$ reasons for not doing this? Wondering if they have other cards yet to be played.

 

[Carl B]

(Let's try to avoid M$ and $ONY type abbreviations)

 

[dobwal]

Well, whatever my point was, it had nothing to do with your reply, unless of course you are saying Microsoft would want functionally equivalent peripherals to be $20 more expensive.

Of course MS wouldn't want to have a $20.00 premium on all peripherals in comparsion to the competition. But we're talking a 20% premium on one peripheral. We also comparing to products that don't directly compete against each other so the price difference isn't going to be weighed that heavily when formulating a MSRP for a 360 GH2 with Guitar sku.

Normal market pressure would demand a lesser price on the PS3 product, since the PS3 sku has to deal with a smaller market, if you wanted to maximize sales of the PS3 peripheral.

 

[borowki]

Borowki I don't know if you realize, but this post further reinforces the points I was making.

I'm not disagreeing with you. For all we know even the platter could be the same.

These are the exact reasons why MS should be able to increase the drive capacity at no real cost to them - because if NewEgg is able to source and sell 60GB drives for under $50, what in the world is MS still doing stuck at 20GB?

Keeping the default at 20GB makes the 120GB add-on and the Elite more attractive...

 

[Cheezdoodles]

I love this, MS price cutting their console is bad because it may anger people. PS3 price cut is great. GH3 gitar being better\cheaper on the PS3 is going to win the console wars.

 

[Tap In]

I love this, MS price cutting their console is bad because it may anger people. PS3 price cut is great.

haha

so true.... price drop is GOOD! geez

 

[scooby_dooby]

haha

so true.... price drop is GOOD! geez

Sure, but MS not dropping price was seen as nearly unthinkable, going into their 3rd holiday season.

So, everyone was expecting a drop. Most people expected $50 at the bare minimum across the 3 sku's, and this drop is even less than that.

So, it's really no surprise that many people feel this drop was inadequate.

I mean, I couldn't imagine them being any more conservative than they are right now. Especially considering they are missing their own sales forecasts...

 

[infinity4]

maybe time for microsoft to upgrade 20GB HDD to 40-60GB? (though i have never seen any 50GB HDDs for some strange reason) it may add good value as a $349 console, and seeming 60GBs are cheap nowadays in comparison to two years ago.

 

[Carl B]

I'm not disagreeing with you. For all we know even the platter could be the same.

That's indeed possible.

Keeping the default at 20GB makes the 120GB add-on and the Elite more attractive...

And agreed, definitely helps to justify (insofar as it can be) the $179 price for the 120GB drive.