A model displays a Microsoft XBOX 360 Arcade model which will now cost $199.99.
For the second time this year, Microsoft has lowered the Canadian prices of its Xbox 360 video game consoles, making the Xbox 360 Arcade the lowest-priced of the next-generation consoles and firing the first shot in what could be a pre-Christmas price war among the big three manufacturers.
Beginning today, Microsoft drops the price of the Xbox 360 Arcade by $70, putting it under the magic $200 mark at $199.99. Microsoft also drops the price of the Xbox 360 Console from $399.99 to $349.99, and the Xbox 360 Elite from $499.99 to $449.99.
This comes just seven months after Microsoft lowered the Elite, Console and Halo 3 prices by $50, and the Arcade by $20.
Today's price changes are expected to boost Microsoft's sales, which have lagged behind competitor Nintendo's phenomenally successful Wii system (launched a full year after the Xbox 360) and, in recent months, behind Sony's PlayStation 3 console.
According to statistics supplied by NPD Canada, total sales of the Wii since its release stand at 1,060,000, leading Xbox 360 (870,000) and PS3 (520,000). Sales in 2008 through August has Xbox 360 in last place (154,000), behind Wii (376,000) and PS3 (200,000).
The $200 mark is considered crucial in the industry, with 75 per cent of all console sales occurring when the price falls below $200. The Nintendo Wii has a suggested Canadian retail price of $249.99, while the Sony PS3's price is $399.99.
In addition to playing popular games, Xbox Arcade can also be used to view movies downloaded from Xbox Live Marketplace, or via its DVD player.
"We feel that with the console price we have now, and the games that we have for it -- Rock Band, Guitar Hero, Lips, Scene It? Box Office Smash and You're in the Movies -- we are really well-positioned to invite a whole new group of consumers to play with Xbox 360," said Craig Flannagan, group platform manager for Xbox Canada.
The success of Wii caught many in the industry, including game publishers, by surprise. Electronic Arts recently remade five of its best-selling franchise titles, Madden NFL, FIFA Soccer, NBA Live, Tiger Woods PGA Tour and NCAA Football, for the Wii, adding All-Play to the titles.
Whether this is the first shot of a pre-Christmas price war among the big three manufacturers remains to be seen. Matt Leviton, director of marketing and public relations for Sony Computer Entertainment Canada, said the PS3 will not drop in price.
"It's really comparing apples to oranges with what you get with a $399 PS3," said Leviton. "We're confident that when you buy a PS3 you're not only getting a great games machine, but you also get a Blu-Ray movie player and the PS3 comes with a WiFi right out of the box."
Nintendo spokesman Matt Ryan was not available for comment Thursday.
One Canadian analyst, however, thinks there will be a price war.
"This [price drop] doesn't really surprise me. The economy is slowing and it looks like it will only get worse," said Neal Clarance, media and entertainment lead for Ernst & Young. "The market is incredibly competitive and the technology continues to advance at an incredible pace. Therefore dropping prices, and a price war leading up to Christmas, seems inevitable to me."
Source: http://www.canada.com/vancouversun/n...8-9dd1597a17f0
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