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Xbox 360 price drop is still a ways off
Xbox 360 price drop is still a ways off
Xbox 360 price drop is still a ways off
Manufacturing costs for Microsoft's Xbox 360 video-game console have been falling faster than expected, the company disclosed last week. Even so, it looks like gamers will need to wait awhile for a price cut.
One reason is that Microsoft continues to lose money on the Xbox 360 -- albeit to a lesser degree than it has in the past. But more notably, the Redmond company's game console is already positioned to have a price advantage over Sony's PlayStation 3 when the competing machine is launched next month.
A Microsoft spokesman said last week that the company has "no plans to adjust the price of the Xbox 360 this year."
Unless the company alters course, that would rule out a price reduction for the upcoming holiday shopping season.
"They'll hold off dropping the price as long as they possibly can," said Matt Rosoff, analyst at independent research firm Directions on Microsoft.
In contrast, Microsoft reduced the price of the original Xbox by $100 six months after its debut. But this time around, the situation is different. In addition to the PS3's price difference, the Xbox 360 has a yearlong head start.
The situation gives Microsoft "the luxury of waiting" to reduce the price, said Michael Pachter, an analyst at Wedbush Morgan Securities.