Analysts have been among those clamoring for a PlayStation 3 price cut, so it's not surprise that EEDAR has been among the first to comment on news that $299.99 is the new entry-level price for the PlayStation 3. Jesse Divinch made his feelings on the matter quite clear with a loud proclamation: "Hallelujah!"
"EEDAR is pleased to see that the PlayStation 3 has finally dropped in price," states Divinch. "The new PlayStation 3 pricing scheme finally makes the Sony console a much more competitive product, relative to its closest rival, the Xbox 360. In terms of value, the PlayStation 3 is a superior hardware product in comparison to the Xbox 360; however, this is not to suggest that hardware sales will suddenly shift to Sony’s favor—a superior hardware system is only one variable in the equation for next-generation success.
"Nevertheless, the PlayStation 3 price cut will act as a positive catalyst that will close the sales gap between the PlayStation 3 and Xbox 360. This price drop also places the PlayStation 3 at a competitive price to the Wii (retail MSRP $249). While the target audience for the two platforms varies greatly, some consumers will face a tough decision to purchase the Wii with outdated processing power or the PlayStation 3 with a built-in Blu-Ray player. However, the market size of those actually debating between a PlayStation 3 and a Nintendo Wii is relatively small."
Looks like Sony has put smiles on a few faces in the industry with its price drop, but will it be too little, too late in the eyes of consumers? We'll have to wait and find out. Meanwhile, read Jesse's full report below the jump.
Hallelujah!
EEDAR is pleased to see that the PlayStation 3 has finally dropped in price. The new PlayStation 3 pricing scheme finally makes the Sony console a much more competitive product, relative to its closest rival, the Xbox 360. In terms of value, the PlayStation 3 is a superior hardware product in comparison to the Xbox 360; however, this is not to suggest that hardware sales will suddenly shift to Sony’s favor—a superior hardware system is only one variable in the equation for next-generation success. Nevertheless, the PlayStation 3 price cut will act as a positive catalyst that will close the sales gap between the PlayStation 3 and Xbox 360. This price drop also places the PlayStation 3 at a competitive price to the Wii (retail MSRP $249). While the target audience for the two platforms varies greatly, some consumers will face a tough decision to purchase the Wii with outdated processing power or the PlayStation 3 with a built-in Blu-Ray player. However, the market size of those actually debating between a PlayStation 3 and a Nintendo Wii is relatively small.
Additionally, we do expect Microsoft to make an official announcement, in the next week, regarding the elimination of the Xbox 360 Pro SKU (retail MSRP $299) and the reduction in the Elite SKU pricing to $299. However, we just consider this a pseudo price drop. It is no different from Lexus introducing their 2010 models at the 2009 prices and clearing out their 2009 inventories. Sure, there is a better value, in comparison to the 2009 models, but a consumer still needs to be in the market for a luxury car to reap the benefits. A consumer shopping for an entry-level sedan will not suddenly upgrade to a Lexus just because the 2010 models have been released. EEDAR does expect the Xbox 360 to get a small boost in sales in the short-term, but considers any Xbox 360 sales lift to be a positive byproduct from additional marketing and retail circular placements.
As a cautionary note, since we do not know the full extent of the upcoming Xbox 360 promotion, there is a possibility that one of the systems could have a larger hard-drive at the $299 price. EEDAR, however, does not believe any disparity in hard-drive size will make a noticeable difference in how consumers value each product. Most consumers would not be able to tell you the true difference between a 120GB hard-drive and an 80GB hard-drive in terms of movie/music/game capacity.
Additionally, EEDAR does not expect these price cuts to increase software sales significantly through the holiday season. Even if the price cuts from both systems increase hardware sales by over 1 million units through the next six months, that would likely add an additional $200 million to the software bucket and would only increase 2009 sales by about 2% over current trend; hardly a significant boost. The true benefit to software sales from a hardware price cut are typically realized in the long-term, over the short-term/
The Holiday Showdown
In the past, declaring which console was truly “a better value” was difficult due to the disparity in pricing, but given that both the PlayStation 3 and the Xbox 360 will share a similar pricing structure this holiday season, the sales results will answer the crucial question: “which console is a better value to consumers?” Few will argue against the common belief that the PlayStation 3 has superior hardware and multi-media capabilities; while the Xbox 360 has a deeper software library and superior online services. Consumers, through their purchases this holiday season, will send a clear message to the gaming community. This is truly a Hardware vs. Software showdown.
A New Standard
The $299 price point will likely become the new standard for the next-generation consoles for the next year. Both Sony and Microsoft are acting like 12th round boxers, so exhausted (in this case, financially exhausted) over the three year battle for next-generation supremacy, that neither are likely to deviate from the $299 price point for some time. It is possible that both consoles may reach a $249 price point 12 months from now, but that will likely be the lowest prices will get in the next two years. Going forward, both console manufacturers will focus more on delivering differentiating products and services to increase the value of their consoles. Both will continue to increase the size of their hard-drives and likely add additional hardware and software features to appeal to consumers. It would not be out of the realm of possibility for Microsoft to include Project Natal as a standard attachment with all Xbox 360 systems in 2011. The same goes for Sony’s new motion controller that is currently in development.
Jim Sterling serves as reviews editor for Destructoid.com, head of the Podtoid podcast, and produces a number of news stories, original features, one-of-a-kind videos. With his passionate argumentative style, controversial opinions, harsh delivery, and dedication to brutal honesty Sterling is a name that you can't help but recognize.
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Contest:
8:30 PM on 08.18.2009
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I'm ecstatic that PS3 haters can't use the phrase "too expensive" now. With the entry level $300 Ps3 system, you get heaps more functionality than a 360 Arcade + HDD costs at a competitive price.
"Settle Down, Beavis"
No.
No one buys a Wii because it is a good system technologically. In fact, no one buys any console because of the technological power. They buy consoles because of the software. There is absolutely no current support for the type of software that drives wii sales on other systems - no games like Wii Fit, Wii Sports, or Mario Kart Wii. And even when Natal and PS3 wand does come out, the support for such games will still be superior on the wii which uses motion controls as a standard rather than a (most likely expensive) suppliment.
This could be a problem for Microsoft's Xbox 360 console sales though, as the PS3 hard drive and online are both free. there's a reason why their called the "HD twins" - for the most part, the two systems are interchangable, such that good news for one is bad news for the other.
Still pretty expensive for me, i'll have to see what christmas brings.
....Unfortunately, I have not been a good boy
You don't make any sense to me.
Wii Fit, Wii Sports, and Mario Kart Wii are the software that sells Wii systems. Because the PS3 doesn't have comparable software, a price cut in no way encroaches upon the Wii's sales. Even when Natal and the Playstation Wand motion controllers are released, they will most likely be peripherals, and not rebrandings of their respective systems (like the Wii was a rebranded gamecube), and thus motion controllers will most likely not become a standard for either Xbox 360 or Playstation 3.
The software that sells PS3s however, games like Modern Warfare 2 and Final Fantasy 13 (but not grand Theft Auto 4 because it didn't sell any systems - http://bits.blogs.nytimes.com/2008/06/12/grand-theft-auto-iv-didnt-boost-console-sales/), are often shared with the Xbox 360. When the PS3 goes down in price, it takes away customers who would have bought an Xbox 360. However, customers who want a wii will simply have no interest in the Playstation 3's software (as there is nothing like Wii Fit or Mario Kart). Thus, a price cut for the PS3 hurts Microsoft, not Nintendo.
"Wii Fit, Wii Sports, and Mario Kart Wii are the software that sells Wii systems. Because the PS3 doesn't have comparable software....."
whoa whoa whoa, lemma read that again "the PS3 doesn't have comparable software".
yep you just said that the PS3 had no comparable software to the wii. there's something called a demographic. the wii has a completely different target audience than the PS3. that and theres Little Big Planet, and Flower, so there is stuff on the PS3 you can compare to wii software. there is also eyepet coming down the line as well as katamari forever. You may want to actually take a look at the large amount of PSN games that can be compared to the wii's full fledged titles. The for this, "Wii Fit, Wii Sports, and Mario Kart Wii are the software that sells Wii systems" that's not true. About 85% of the wii's sales were completed before Mario Kart Wii came out, and wii sports comes with the damn console... It was always the price that hooked people into buyig the wii. That and the motion sensing gimmmick. Notice the EXTREMELY drastic slowdown of wii sales as of late. A PS3 price drop does hurt Nintendo contrary to what you believe. This price cut combined with FF13 being PS3 only in japan will strike Nintendo, as well as God of War 3 within the same time frame. Microsoft has ODST to help the 360 as well as a whole bunch of shooters that won't e coming to the wii. Did you not see the mass delays of games that were pushed to 2010. THAT will probably hurt Nintendo a lot because there aren't any wii games that can compete with games like Bioshock 2 and Read Dead Redemption.
You thinking the MW2 sells PS3s is a joke. There are 3 platforms that will carry that game. PS3,360 and PC. Games don`t sell consoles this gen. This isn`t PS2 vs GC vs xbox anymore. Last gen PS2 had ALL the exclusives. This gen it`s not even close anymore. This gen is more about how much your console costs in the long and the short run. The topic of price has been the biggest thing this gen. There`s a reason that the GC didn`t sell last gen. No good 3rd party support despite being the lowest priced. Nintendo just stuck a magic wand with the wii and sold it at a low price. thats why`they have over 50 million consoles sold. It`s like Morpheus giving Neo a choice between the red piil and the blue pill but telling Neo the red pill tastes like candy.
@Xiaolinstyle - Over 20 million people bought Wii Fit. It was outselling the PS3 for months, and I wouldn't be surprised if by the end of the generation, Wii Fit outsells the PS3.
Did you know that the NES was also declared a fad by the (computer) gamers of it's era?
And I am very surprised at your animosity towards Metroid Prime's control scheme.
Nintendo's Wii is posed to be the best selling console of all time, targetting gamers that the other systems didn't appeal to. I highly doubt they would drop out of the console race, especially since they have a very large new following of people demanding a service no one else supplies at all. It would be an injustice to the expanded audience if the only console maker of expanded market software were to drop out, leaving a void in an industry that the HD twins are unfit to fill.
@Xiaolinstyle - Over 20 million people bought Wii Fit. It was outselling the PS3 for months, and I wouldn't be surprised if by the end of the generation, Wii Fit outsells the PS3.
Did you know that the NES was also declared a fad by the (computer) gamers of it's era?
And I am very surprised at your animosity towards Metroid Prime's control scheme.
Nintendo's Wii is posed to be the best selling console of all time, targetting gamers that the other systems didn't appeal to. I highly doubt they would drop out of the console race, especially since they have a very large new following of people demanding a service no one else supplies at all. It would be an injustice to the expanded audience if the only console maker of expanded market software were to drop out, leaving a void in an industry that the HD twins are unfit to fill.
@Xiaolinstyle - Over 20 million people bought Wii Fit. It was outselling the PS3 for months, and I wouldn't be surprised if by the end of the generation, Wii Fit outsells the PS3.
Did you know that the NES was also declared a fad by the (computer) gamers of it's era?
And I am very surprised at your animosity towards Metroid Prime's control scheme.
Nintendo's Wii is posed to be the best selling console of all time, targetting gamers that the other systems didn't appeal to. I highly doubt they would drop out of the console race, especially since they have a very large new following of people demanding a service no one else supplies at all. It would be an injustice to the expanded audience if the only console maker of expanded market software were to drop out, leaving a void in an industry that the HD twins are unfit to fill.
@Xiaolinstyle - Over 20 million people bought Wii Fit. It was outselling the PS3 for months, and I wouldn't be surprised if by the end of the generation, Wii Fit outsells the PS3.
Did you know that the NES was also declared a fad by the (computer) gamers of it's era?
And I am very surprised at your animosity towards Metroid Prime's control scheme.
Nintendo's Wii is posed to be the best selling console of all time, targetting gamers that the other systems didn't appeal to. I highly doubt they would drop out of the console race, especially since they have a very large new following of people demanding a service no one else supplies at all. It would be an injustice to the expanded audience if the only console maker of expanded market software were to drop out, leaving a void in an industry that the HD twins are unfit to fill.
@Steel Brotha - No, you CAN NOT compare Little Big Planet to Wii Fit, Wii Sports, or Mario Kart Wii. Of the Wii Titles that sold over ten million copies, there are no games that are directly comparable on an HD console. Even Mario Kart Wii doesn't have a clone on an HD console that stacks up.
Your post becomes somewhat contradictory. Either the Wii serves a completely different demographic, or Final Fantasy 13 being on a different system hurts the Wii, but not both. And the reason Wii Sports was packed in is because it sold systems. People did in fact buy the Wii for Wii sports.
In responce to your second post - 3rd party support is irrelivent this generation, the Wii proved thoroughly. Cost is too; Note that while game doughts have hurt wii sales, price cuts on competing systems didn't have a notable impact. Cost cutting is a red ocean issue for interchangable systems appealing to the same customer demands, but because no other console fulfills the same demands as the wii, it is in a blue ocean, and thus cost cutting is not important. Maintaining the percieved value of the console however, is important.
one more thing. you said that over 20 million bought the wii fit right?
read this then :
http://www.bit-tech.net/news/gaming/2008/07/04/64-percent-of-gamers-gave-up-on-wii-fit/1
64 percent of people stopped using wii fit immediately. that's over 12 million unsatisfied people. and these are the people who are gonna make the wii the highest selling console of all time?
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Head-On! Apply directly to the forehead!
anyway its great that the ps3 dropped in price and i have to agree with steel brotha when ff13 is out in japan with the newly dropped price on ps3 that gonna wreck wii sales for the holiday.
http://vgchartz.com/hwlaunch.php?cons1=Wii®1=All&cons2=PS2®2=All&cons3=®3=------&weeks=156
You could also say that Wii Fit managed to keep 8 million wii users fit. Considering how many times I return to old minigame collections, that's pretty impressive - around the same number of people who bought Halo 3 use Wii Fit on a regular basis over a year after it's release.
Bottom line: the wii sold on a gimmick that costs literally hundreds less than the other competition. if your not going to factor that in then your argument isn't very viable.
Somthing tells me the Wii will do just fine with New Super Mario Bros Wii this holiday season.
in the USA and EU yah probably im mainly talking about Japan (they love them rpgs ) also i have to say im soo excited for New super mario bros, but u do have a point Mario is like the only franchise that can appeal to both hardcore and causual gamers and thats probably sell insanly well.
If you can show how one can substitute the Wii's best selling software with the PS3's popular software, then you have a point - However, I do not beleive this is possible, because Wii Fit, Wii Sports, and Mario Kart Wii simply do not (currently) have a comparable title on an HD console that has received any significant attention.
your vgchartz is incorrect:
http://news.cnet.com/PlayStation-2-passes-sales-milestone/2100-1043_3-5141061.html
http://news.bbc.co.uk/2/hi/technology/2664337.stm
vgchartz isn't reliable. don't use it to prove points.
And by incomparable, I am not referencing sales or quality. I mean the Playstation 3 is not a product that can be considered interchangable with the Wii. If I want a Playstation 3 but see an Xbox 360 on sale, I could easily buy the 360 instead because it has a similar role. If I want a Playstation 3 but there is a Wii instead, I am not going to be able to play the games I want on the Wii, and I won't buy it. They have different roles and appeal to different customers - thus price cuts on the PS3 will have a significant affect on the 360, but not the Wii.
Pepsi meet Coke.
Christ, who let the kids from GameFAQ's in?
Thisll barely scratch the Wii.
a) £180 isn't pocket change. No need to be a cunt.
b) it'll cost £249 in the UK, not £180. That's even more money.
I doubt that the PS3's price cuts will do much either.
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