NonPhixion
Member
The 360 had a year head start and still found themselves tied with the PS3. Are we forgetting how well the Xb1 has done in comparison to the ps4? They certainly added to the 360's success.
MS is out in desperation.
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Microsoft is waiting for Sony to reveal PS5 price to undercut it with Xbox Series X, say Michael Pachter and Peter Moore
The 360 had a year head start and still found themselves tied with the PS3. Are we forgetting how well the Xb1 has done in comparison to the ps4? They certainly added to the 360's success.
MS is out in desperation.
Klayzer
Member
That would be awesome if shit like that happened in corporate sales. A pipedream, but funny.
Klayzer
Member
I just can't see any of console makers giving up that billion dollar sub revenue. Unfortunately, gamers had a chance to vote their displeasure with it with Sony, like they did with Microsoft's used game policies at the start of the gen. If all the gaming media and fans had voiced their anger in unison, we might still have had free online for at least one of the consoles. Though, still very unlikely it would have happened.
Dory16
Banned
The why did Sony cut the price of the PS3 a year in if the 360 could not compete with their brand?
Knightime_X
Member
It didn't help that Xbox's former ceo Don Mattrick didn't know wtf he was doing with the Xbox brand.
Water Cooler? pls
thicc_girls_are_teh_best
Member
Radical_3d
Maybe my response was a bit too hot off the gun. Had to re-read your post; I didn't see the point you were making until re-reading it.There's still an item or two inaccurate (the SSD in XSX isn't necessarily off-the-shelf, it's a custom casing designed in tandem with Seagate), but you're generally right about the other stuff. PS5 does have those particular features and things like the controller, SSD I/O hardware and cooling system are going to be a nice chunk of the BOM.
Both systems are probably very similar in their overall BOM; I can see XSX's BOM being slightly cheaper but MSRP reflective of that being more realistically priced at $449, not $399. If it turns out to come in at $399 I'll happily shoot myself in the other foot.
Nikana
Go Go Neo Rangers!
It makes sense to get as many people into the eco system now where there are 50 million owners vs trying to sell them on it with a $499 console. Then you can simply say get Series X and since you already have gamepass, you don't have to spend a dime more to play the games you want to.
Bloody Knuckles
Banned
Have a feeling this will be a game of chicken, next Sony event I could see them revealing the console and games withholding the price until MS event. If then MS announces their price I could see a week later only announcing it via twitter and Instagram because those have been successful platforms for turn so far regarding ps5 announcements
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VAL0R
Banned
Microsoft, a trillion-dollar company, can certainly afford to wait as long as they'd like to announce price. If they want to outlast Sony they will, period. Sony is small beans compared to Microsoft in the business world. I know Sony fanboys struggle with that difficult reality.Actually with an install base of around 110 million PS4s vs 50 million XB1s the one who can wait is Sony.
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Nikana
Go Go Neo Rangers!
360 definitely competed. Their first 3-4 years was incredible. Sony did cut their price to compete. If anyone is saying different they are flat our wrong.
Sony was something else during that Launch. They treated people like idiots and did interviews constantly lying and pretending PS3 was going to be an even bigger success than ps2.
They made a lot of changes in those first 3 years which included doing everything they could to get the price down asap and redesigned the entire board to cut costs and features.
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Klayzer
Member
I would disagree with that. Xbox doesn't have unlimited access to Microsoft's war chest, no matter how much you wish it to be so.
IntentionalPun
Ask me about my wife's perfect butthole
But that kind of decision wouldn't exist in a bubble. You bleed money you better make it back; product becomes more of a risk, you immediately become under great scrutiny from your board of directors, etc. And I'm bringing those things up because they tend to lead to what we don't want; decisions unfriendly to the consumer later down the road.
MS might be thinking of going the loss leader route, might be basing that on what Sony does, etc.. but it wouldn't necessarily mean we as gamers win.
Well why not give it away for 50 dollars then,if they worth so much.Why are they holding out in announcing the prices.
Your talking rubbish.
Nikana
Go Go Neo Rangers!
How are they bleeding money if they don't take a loss??
Snake29
RSI Employee of the Year
Buy Gamepass, get a free XSX.
IntentionalPun
Ask me about my wife's perfect butthole
The topic of the post you responding to was loss-leading hardware; aka hardware that takes a loss.
So... huh? I'm literally talking about the idea of MS (or Sony) being willing to take a loss on hardware. Not sure what you, the person responding to me, are talking about.
edit: I think i get what you are saying now... just so confusing because you didn't really indicate WTF you were talking about lol.. you are talking about GamePass deep discounts but aren't actually talking about the main topic of my post (loss leading hardware)
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Arkam
Member
Doubt Pachter or Moore have any direct knowledge of components or actual cost. BUT they are both very familiar with consoles and their launches and this prediction is a fairly logical one. MS is in a better position to bleed a little red (as Xbox is not their main revenue) and MIGHT actually have a lower component cost. PS on the other hand is one of the main revenue streams for Sony, so they will very much more prudent.
So what does it mean? Nothing until MS/PS say their prices. Be prepared for anything from $400-$600 cuz at this point all are plausible.
So what does it mean? Nothing until MS/PS say their prices. Be prepared for anything from $400-$600 cuz at this point all are plausible.
Radical_3d
Member
So, I just watched the whole show. So great to see this bunch back... Pachter said MS would take a 100$ hit per unit but it could mean a $449 if the BOM is too high, so maybe $399 was based on his asumption that the BOM is actually $500, but who knows.
There's still an item or two inaccurate (the SSD in XSX isn't necessarily off-the-shelf, it's a custom casing designed in tandem with Seagate), but you're generally right about the other stuff. PS5 does have those particular features and things like the controller, SSD I/O hardware and cooling system are going to be a nice chunk of the BOM.
Both systems are probably very similar in their overall BOM; I can see XSX's BOM being slightly cheaper but MSRP reflective of that being more realistically priced at $449, not $399. If it turns out to come in at $399 I'll happily shoot myself in the other foot.
I mean, by early-mid 2019 I was hoping for a 64GB SSD and $499 for the PS5. If they'd told me they were going to put a 800GB PCIe 4 with speed not yet available I'd laugh my ass off. And yes, the SSD in SX is not completely off the shelf by my point was to ilustrate just how much expensive the PS5 one was.
Anyways I think they'll match each other's price.
Klayzer
Member
You can almost bank on at least one Xbox guy, injecting Microsoft's market cap value in every Xbox discussion. I guess it's some strange source of pride for whatever reason.
ethomaz
Banned
Because it was too expensive.
But you know even with that price it sold more than 360 in first year.
Kokoloko85
Member
Who has the last reveal this summer? Thats who will do it lol
godhandiscen
There are millions of whiny 5-year olds on Earth, and I AM THEIR KING.
After the pandemic, Microsoft suddenly finds itself in an enviable position.
Their stock is at an all time high based on earnings and performance:
- Azure is performing really well as users of the platform (other businesses) see increase demand for their services and thus have to scale their Azure consumption.
- Office 365 and MS Teams are selling gangbusters because more companies need more enterprise remote collaboration tools due to the new social distancing measures.
- A major source of revenue for the next decade, the JEDI contract (10bn) is almost secured.
Of course MS going to subsidize the price of the XsX; the move makes absolute sense.
Microsoft is already undercutting their competition in other industries to make up for lack features, brand weight, known quality.
- Cloud: Azure costs are significantly cheaper than AWS; Microsoft doesn't lose money on cloud, but it charges cheaper prices than AWS to attract new businesses.
- Enterprise: Microsoft Teams, the Slack/Zoom competitor is pretty much handed out for free with an Office 365 subscription. Since they started packing it for almost free a year ago, they have become the market leaders in terms of users. Their product still sucks against the competition, but free is free, and companies will cut costs at any opportunity they have.
- The Jedi contract. Microsoft won this contract by undercutting Amazon's bid by several billion dollars.
It is clear that Microsoft doesn't hesitate in using a subsidized pricing model to undercut their competitors. I am confident they will price their console at the price of the PS5 regardless of what it costs to make.
Their stock is at an all time high based on earnings and performance:
- Azure is performing really well as users of the platform (other businesses) see increase demand for their services and thus have to scale their Azure consumption.
- Office 365 and MS Teams are selling gangbusters because more companies need more enterprise remote collaboration tools due to the new social distancing measures.
- A major source of revenue for the next decade, the JEDI contract (10bn) is almost secured.
Of course MS going to subsidize the price of the XsX; the move makes absolute sense.
Microsoft is already undercutting their competition in other industries to make up for lack features, brand weight, known quality.
- Cloud: Azure costs are significantly cheaper than AWS; Microsoft doesn't lose money on cloud, but it charges cheaper prices than AWS to attract new businesses.
- Enterprise: Microsoft Teams, the Slack/Zoom competitor is pretty much handed out for free with an Office 365 subscription. Since they started packing it for almost free a year ago, they have become the market leaders in terms of users. Their product still sucks against the competition, but free is free, and companies will cut costs at any opportunity they have.
- The Jedi contract. Microsoft won this contract by undercutting Amazon's bid by several billion dollars.
It is clear that Microsoft doesn't hesitate in using a subsidized pricing model to undercut their competitors. I am confident they will price their console at the price of the PS5 regardless of what it costs to make.
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Clear
CliffyB's Cock Holster
Not true. When the 360 launched the PS2 was at 100m globally. Sony sold 60m PS2's in direct competition with 360 and laterly PS3.
This is verifiable, historical fact.
The reality is the 360 sold very well in the US and UK, beyond that... not so much.
thismeinteil
Member
You also have to remember that after MS got the BOM down, they started having sales left and right where the XBO was $50-$75 cheaper than the PS4. I'd hate to see what the gap would be without those sales.
@ OP
Not going to happen. MS is not in the business of losing money on HW. They didn't this gen, launching both systems at $500, they aren't going to next gen, either. MS is moving towards a services company. They aren't going to blow those profits on losing $100-$150 on every piece of HW sold.
If anything, we've seen that Sony is the company more inclined on taking loses on HW. Especially when it is as important to them to push HW as it will be next gen. Their system also seems to have the cheaper BOM. In the end, I think we'll see a $399-$449 PS5 vs a $499-$549 XBSX.
ethomaz
Banned
Yeap they fire sale Xbox to try to slow down the gap.
Most of time it is really hard to find a Xbox close to MSPR... it was $50-100 below it.
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Guy_who_thinks_hes_cool
Member
nah...
PS5 will still sell more than XBOX, like its always
like..... its always ever been
price difference or not
PS5 will still sell more than XBOX, like its always
like..... its always ever been
price difference or not
darkinstinct
...lacks reading comprehension.
It was obvious for a long time that Sony wants Microsoft to go first and Microsoft wants Sony to go first. I think they would both like (because of cost) to be at 499, but they both know if the other one goes to 399 they will have to do the same. It looks like Microsoft is doing everything they can to come out after Sony. The recently moved first party event that is now happening in July, Sony not talking about PS5 and now opting for June, eventually they run out of time if they want to do preorders. It's simply a complete reversal of 2013.
Papacheeks
Banned
I can guarantee you cost wise PS5 controller is more. The cooling solution for sony im going off of patents. It could be something they have had in the works for a while, and like you said may not contribute to costs since it would be calculated as R&D.
But actuaators in PS5 controller, among the built in MIC, speaker, usb C, built in battery will add up to a 69.99 controller. I'd be shocked if it came in at 59.99.
Longer battery life was a big cost for Switch Pro controller among the Gyro sensors which is why it's 69.99. Bigger battery will cost more. And PS5 controller from what I've read has a much larger battery using USB-C for fast charging.
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Klayzer
Member
Good point. I could easily see the retail price for PS5 controllers at 79.99
Nextgen accessories are going to be very expensive IMO.
Papacheeks
Banned
I don't think it will be 79.99. i think 69.99 is the price it will be. But god knows what storage is going to cost. I mean literally there are only a few NVME drives that are even close to the speed PS5 ssd has, and they have to be compatible.
On top of that, the Dedicated storage that Microsoft is making which seems to be only going through seagate is not going to be cheap either.
Klayzer
Member
I don't know. I wish I was as optimistic as you are on it. These console makers have zero conscious with pricing, when it comes to their first party accessories.
Papacheeks
Banned
I'm going by BOM from Switch and Xbox on S controller. Switch Pro controller uses a form of USB-C and has a very large battery with Gyro controls. I don't know if PS5 has those, but it has other bells and whistles that will add to the cost.
I think they know charging 79.99 is pretty ridiculous. 69.99 is swallable since they have not changed price for 2 gens on controllers.
Dory16
Banned
Too expensive had everything to do with the competition. Nothing is too expensive in a vacuum and if that was the case, manufacturers would always know better than to put out a product that is "too expensive".
Basic microeconomics do not support your narrative that the 360 could not compete with the PS3 brand. It's a fact that it did. And the notion that the PS3 outsold the 360 in its first year at its initial price is a complete fabrication, pretty much like everything you say on this forum. It's at least the fifth time I catch you in an easily verifiable lie:
Source: https://www.vgchartz.com/article/250980/playstation-3-lifetime-sales-overtakes-the-xbox-360/
pixelation
Member
Pachter ey?, XBSX need to sell a kidney in order to buy one confirmed.
ethomaz
Banned
Your data is wrong.Too expensive had everything to do with the competition. Nothing is too expensive in a vacuum and if that was the case, manufacturers would always know better than to put out a product that is "too expensive".
Basic microeconomics do not support your narrative that the 360 could not compete with the PS3 brand. It's a fact that it did. And the notion that the PS3 outsold the 360 in its first year at its initial price is a complete fabrication, pretty much like everything you say on this forum. It's at least the fifth time I catch you in an easily verifiable lie:
Source: https://www.vgchartz.com/article/250980/playstation-3-lifetime-sales-overtakes-the-xbox-360/
When PS3 launched the 360 had already shipped over 6M units not counting Oct and Nov (they shipped more 4.4m
In Oct-Dec 2006).. it was probably a bit over 8 million the head start gap.
Fabrication? 360 shipped in first four Qs was 5 million units... PS3 shipped in fist four Qs was 5.63 million.
You know these data are public lol
Truth > Your fabrications.
Edit - The 3rd comment tried to correct them but they never fixed the article lol
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Dory16
Banned
And where is your proof that the ps3 sold more than 8 million in its first year, at the price of 600$?
Not only do you never bother to bring any proof to your statements (I wonder why), you are quick to discredit established sources that others make the effort to link. It’s like you’re in a permanent holiday from the facts.
Ozzy Onya A2Z
Member
I kinda want to see MS go all out loss leading and release the console in July or August or Sept just to really stick it to Sony. I don't really car for console wars but I'm over the Sony wait and counter game TBH. It would be too much fun for XSX to release the price and the actual console at the same time and way earlier than Sony expected. Capitalise on Sony's high manufacturing costs and slow rollout by delivering to market months and months earlier.
ethomaz
Banned
Dude... learn to read.
”360 shipped in first four Qs was 5 million units... PS3 shipped in fist four Qs was 5.63 million.
You know these data are public lol”
That accounts for 10 months.
If you add the Oct-Dec quarter (1 year and 1 month) you have:
360: 10.4m
PS3: 10.53m
Quartely results are public you don’t need to link them... they are fact.
Launch aligned PS3 didn’t track below 360... the opposite it did catch the 8 million head start.
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Craig of War
Banned
Let the Trillion and Billion dollar company fight over price we the consumer benefit nice
Radical_3d
Member
That strategy worked flawlessly with the Sega Saturn, right?
KingdomHeartsFan
Member
Hope this is true. When companies compete over price guess who wins.
Explosive Zombie
Banned
PS3 had a bad launch due to a high price but in the end they did price cuts and sold more units than 360 by the generation's end... so does it really matter?
Craig of War
Banned
Yes it sold more by like 1-2 million units but Xbox made more noise and was the leading platform for the Devs and profit that gen.
Explosive Zombie
Banned
I'm just saying it doesn't feel like it matters all that much. If they compete we win but price, long term, doesn't make or break a console.
Craig of War
Banned
Yeah price alone won't make or break a console it takes a combination of Price Power Games and Marketing and the only console i can think of that fail on all of those was the Wii U.
AlexxKidd
Member
Damn, savage. Knowledge is getting dropped on mofos heads up in here.
Dory16
Banned
Learn to read what? More fabrications? I asked for proof and you pulled out more unsubstantiated fallacies.
That closes the conversation.
Upgrade the lies. You’re too easy to find out.
The 360 did compete very well against Sony’s brand, that’s what’s an irrefutable fact. They had sold almost an indentical number of units worldwide by the end of the generation in 2012.