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[Chris1]

Exactly. Dropping the price by 30% in a year while cost to manufacture and distribute is still at its highest point in the console cycle? I could only see red in the balance sheets.

They've dropped the price by 10-12%, where are you getting 30% from?

 

[RetroStu]

Whether the number is 8m or not, Xbone is doing very well. It's selling better than the 360 did at the same point in it's life cycle. Xbone just isn't doing as well as the PS4, which is doing uncommonly well.

It's not doom and gloom for MS by any means.

I haven't been following the sales data since the first few months but yeah i thought it was doing very well compared to the 360. Plus the 360 had no PS3 as competition in its first year either.

The PS4 is just doing brilliant and i'm so happy for it, it will be my first next gen console when i mange to find a new job. I just don't get the constant doom over X1 when its seemingly doing well compared to past consoles.

 

[vpance]

Thanks for the fair post.
I haven't been fooled though, i just find it hard to believe there would be 3-4mil X1's sitting on store shelves.

Warehouses, trucks, bunkers, cargo trains and planes, etc.

 

[BuggeryBugz]

I don't know how that fits the definition of a guess but suit yourself.

So I'm meant to provide evidence that they DIDN'T release sell through numbers some months ago. Ummm, how am I supposed to do that?

I dont want you to provide anything, I just don't want you and others to tell someone they are spreading mis-information when they are offering their opinion.

Anyway, let's get back to the topic at hand, shall we?

 

[Codeblew]

It just gets tiring to see the same misinformation spreading. Like the other poster said, we can get an idea of what they have sold through based on NPD data and previous official announcements (estimating WW numbers via percentage of overall sales). There is no way the X1 is at 8 million or even 7. At best it's around 6.5, and it'll still be selling through the 10 million well into Feb/March.

MS put out this PR to fool people and it seems to work incredibly well.

*Almost* 10 million could mean just about anything. It could be 9 million. It could be 8 million. I am sure since the statement came from PR, they are using a liberal definition of almost.

 

[Dragonborn]

I haven't been following the sales data since the first few months but yeah i thought it was doing very well compared to the 360. Plus the 360 had no PS3 as competition in its first year either.

The PS4 is just doing brilliant and i'm so happy for it, it will be my first next gen console when i mange to find a new job. I just don't get the constant doom over X1 when its seemingly doing well compared to past consoles.

The X1 is practically dead outside the US/UK and getting soundly beat in those two territories. MS has had to cut the pricd by $150 along with offering multiple games just to keep up.

It's still tracking ahead of the 360, but that's only due to launch and the 360's supply issues. It'll fall behind the 360 in due time, and the fall is going to be hard

 

[alr1ght]

They've dropped the price by 10-12%, where are you getting 30% from?

500 to 350 is 30%.

 

[stryke]

I dont want you to provide anything, I just don't want you and others to tell someone they are spreading mis-information when they are offering their opinion.

Anyway, let's get back to the topic at hand, shall we?

Dear fucking christ. There is no opinion in "Did Microsoft say they sold 6 million units to customers some months ago?"

 

[Chris1]

500 to 350 is 30%.

Got a source on them dropping the xbox + kinect to $350 rrp?

 

[SyenceLabb]

The X1 is practically dead outside the US/UK and getting soundly beat in those two territories. MS has had to cut the pricd by $150 along with offering multiple games just to keep up.

It's still tracking ahead of the 360, but that's only due to launch and the 360's supply issues. It'll fall behind the 360 in due time, and the fall is going to be hard

this is the type of doom and gloom I like to hear.

 

[JayhawkerStL]

They've dropped the price by 10-12%, where are you getting 30% from?

People are ignoring the the bulk of the price cut is dropping the Kinect.

Microsoft may still get hurt if no one buys any of the Kinects they are now removing from packages, but I suspect they will get them sold off over time.

I have no breakdown in the cost of each console, but I was just assuming that the more powerful PS4 also had more expensive parts. That amy not be the case and a bad assumption. But it also feels like people trying to have it both ways.

I guarantee you Microsoft didn't want to drop the price this soon, but they cannot head into the 2015 holiday season with shrinking marketshare. They would see a death spiral for the console, as developers would start moving away.

 

[Palocca]

Do they really need to make a profit on hardware though? I've never understood this, they should be selling it at a loss to sell more units to customers THEN make the money back from games and xbox live

Anyways, they were profiting at $500 and now they removed kinect and selling it for $400 while selling kinect seperate for $150, so I'd say they're probably still making a profit at $400.

The problem is how much they're losing with each console sold. Yes, they have services to sell to make up the costs, but MS' goal should be to mitigate the cost of the console to turn the red into black. Not only that, you have to factor in the R&D costs of developing the console, as well as writing off the R&D (and probably supplies) of the Kinect.

EDIT: I also forgot to mention packaging/distribution costs. Even if the cost of the parts to construct the console is under the MSRP, getting the finished product to the store will put it back in the red.

 

[Chobel]

I would expect price cut to become permanent, and there will probably always be a bundle of some sort with it. The benefit of slightly less powerful specs is that it was easier for MS to drop the Kinect and undercut Sony. Sony has a more expensive console and far less the bank to wage an actual price war.

Actually PS4 is the cheaper console to manufacture, even though it's the more powerful console.

http://www.ign.com/articles/2013/11/27/teardown-reveals-xbox-one-costs-55-90-more-to-make-than-ps4

 

[JumpJeff84]

I haven't been following the sales data since the first few months but yeah i thought it was doing very well compared to the 360. Plus the 360 had no PS3 as competition in its first year either.

The PS4 is just doing brilliant and i'm so happy for it, it will be my first next gen console when i mange to find a new job. I just don't get the constant doom over X1 when its seemingly doing well compared to past consoles.

Yeah it's doing well. The major issue is that PS4 is dominating in US, Japan AND Europe. Last gen MS had US on lock, whereas this gen PS4 is leading in all regions. The big fear is that if MS can't even outsell Sony is US, the gap may widen a lot.

But again, who knows? We're only a year in.

 

[Tigress]

I imagine they're hoping that if Sony takes a beating during the holiday period it will push them to become more aggressive either via price cuts or announcing more games.

Or in my case making PS+ as good as it used to be. Though I'm starting to get a little hope with their December and especially January announcement.

 

[vesvci]

Exactly. Dropping the price by 30% in a year while cost to manufacture and distribute is still at its highest point in the console cycle? I could only see red in the balance sheets.

I think they're banking on those (2) $25 XBO accessories to make up the difference of the $50 drop...the controller audio adapter and charge kit. Even with 3rd parties, very likely that they have licensing fees associated with them.

I've yet to see them individually on sale, only the controller + charge kit for $65...

Nickel and diming at it's best.

 

[Dragonborn]

this is the type of doom and gloom I like to hear.

It's not doom and gloom, it's facts. The X1 will sell okay when all is said and done but MS will be very, very lucky to reach even half the install base the 360 had. And unless Sony screws up big time, I don't really see the Xbox brand recovering, especially outside NA.

So yes, I don't see how this counts as baseless doom and gloom

 

[crazyprac]

Or in my case making PS+ as good as it used to be. Though I'm starting to get a little hope with their December and especially January announcement.

Define PS+ as good as it used to be? You mean gamewise? I agree we haven't had real good retail ones but its the first year. IMO ps3 ps+ didn't really get good until the latter years when it had more choices to which games.

 

[stryke]

I think they're banking on those (2) $25 XBO accessories to make up the difference of the $50 drop...the controller audio adapter and charge kit. Even with 3rd parties, very likely that they have licensing fees associated with them.

I've yet to see them individually on sale, only the controller + charge kit for $65...

Nickel and diming at it's best.

Actually, you're forgetting Gold memberships. Sell someone a Xbox One unit and you're pretty much guaranteed a continuing source of revenue for years.

 

[Tigress]

Define PS+ as good as it used to be? You mean gamewise? I agree we haven't had real good retail ones but its the first year. IMO ps3 ps+ didn't really get good until the latter years when it had more choices to which games.

But the thing is I"m not just talking PS4, I'm talking ps3 and vita. If it was just PS4 I would just chalk it up to new console and there isn't much yet to put out on it. But PS3 and Vita have slipped a lot as well the past few months. Hell, I'd even be happy with some PSP games and not just indie games (and all seem to be platformers too). Shoot, what is giving me hope is the stuff they are announcing for PS4 though I'm not interested in one and mildly interested in the other but it's more in the direction I'd like to see.

 

[Guevara]

Actually, you're forgetting Gold memberships. Sell someone a Xbox One unit and you're pretty much guaranteed a continuing source of revenue for years.

That's true. Microsoft (corporate) has been playing around with all kinds of subscription schemes: Office 365, Xbox Music, Skype, even the $199 plan that includes all that plus Xbox Gold.

If Xbox has a bright future at Microsoft, it's probably as a subscription service.

 

[BuggeryBugz]

Dear fucking christ. There is no opinion in "Did Microsoft say they sold 6 million units to customers some months ago?"

Anyway, it seems like someone woke up in the wrong side of the bed and that is obviously affecting your reading comprehension.

Cheers!

 

[Palocca]

That's true. Microsoft (corporate) has been playing around with all kinds of subscription schemes: Office 365, Xbox Music, Skype, even the $199 plan that includes all that plus Xbox Gold.

If Xbox has a bright future at Microsoft, it's probably as a subscription service.

Yup, services are where the money's at nowadays. Adobe's doing it with Photoshop and Lightroom as well. Netflix, Hulu+ and Spotify are at an all time high in terms of popularity. Pretty soon, half of our expenses are going to be paying off subscription services.

 

[truth411]

I imagine they're hoping that if Sony takes a beating during the holiday period it will push them to become more aggressive either via price cuts or announcing more games.

It doesn't make sense though, when you include the PS4 digital library, the PS4 game library is bigger than Xbox. M.S. is making these deals because they have to in attempt to remain competitive in there home market. If M.S. raise the price back to normal in January, there sales are going to collapse, I guarantee you that M.S. wish they were in Sony's position right now. M.S. is arguably devaluing there box just a year after launch, not a good position to be in.

 

[SyenceLabb]

It's not doom and gloom, it's facts. The X1 will sell okay when all is said and done but MS will be very, very lucky to reach even half the install base the 360 had. And unless Sony screws up big time, I don't really see the Xbox brand recovering, especially outside NA.

So yes, I don't see how this counts as baseless doom and gloom

Predicting the future is facts?

 

[Dragonborn]

Predicting the future is facts?

My first sentence referred to my original post, which was info we currently do have. The rest of it is my own prediction which, obviously, is not a fact

 

[LowEndTorque]

Actually PS4 is the cheaper console to manufacture, even though it's the more powerful console.

http://www.ign.com/articles/2013/11/27/teardown-reveals-xbox-one-costs-55-90-more-to-make-than-ps4

That was mainly due to Kinect though.

I'd like to see an updated breakdown of a kinectless X1 vs a base PS4. Bigger die and more transistors on X1 vs. more expensive RAM and GPU on PS4. It's probably about even now.

 

[Chris1]

The problem is how much they're losing with each console sold. Yes, they have services to sell to make up the costs, but MS' goal should be to mitigate the cost of the console to turn the red into black. Not only that, you have to factor in the R&D costs of developing the console, as well as writing off the R&D (and probably supplies) of the Kinect.

EDIT: I also forgot to mention packaging/distribution costs. Even if the cost of the parts to construct the console is under the MSRP, getting the finished product to the store will put it back in the red.

I don't think they are losing that much on each console sold though. They were making a profit at $500 then dropped the kinect and are selling it separately for $150, so at $400 I'd say they are making even more profit per console than at launch. You do have a point with R&D though I didn't think about that when I posted.


Though I'm sure they are making a loss now with the price cut and all the free games and I doubt they wanted to drop the price or get this "desperate" as they probably expected to run away with this gen, but it was needed really otherwise the console would have fallen even further behind the PS4 which would have been even worse with less people to sell games/live which is why IMO companies should sell consoles at a loss to begin with..Then again I don't and never will own a successful gaming company so what do I know lol

On the bright side.. I just got membered, Thanks whichever admin!

 

[Dragonborn]

That was mainly due to Kinect though.

I'd like to see an updated breakdown of a kinectless X1 vs a base PS4. Bigger die and more transistors on X1 vs. more expensive RAM and GPU on PS4. It's probably about even now.

No, even without Kinect it was still more expensive.

MS somehow managed to build a less powerful, and still more expensive box. I don't know how their R&D team managed that but almost everything about the system has been ond giant mistake

 

[Chobel]

That was mainly due to Kinect though.

I'd like to see an updated breakdown of a kinectless X1 vs a base PS4. Bigger die and more transistors on X1 vs. more expensive RAM and GPU on PS4. It's probably about even now.

Well from the article: X1 cost $90 more than PS4, Kinect cost $75. So kinectless X1 cost $15 than PS4.

 

[jedimike]

That's true. Microsoft (corporate) has been playing around with all kinds of subscription schemes: Office 365, Xbox Music, Skype, even the $199 plan that includes all that plus Xbox Gold.

If Xbox has a bright future at Microsoft, it's probably as a subscription service.

They do have 48 million Xbox live subscribers. That's quite a chunk of revenue every year. But then again, they also have thousands of servers to maintain.

 

[Thunder Monkey]

That was mainly due to Kinect though.

I'd like to see an updated breakdown of a kinectless X1 vs a base PS4. Bigger die and more transistors on X1 vs. more expensive RAM and GPU on PS4. It's probably about even now.

Well again, the ESRAM will likely eat up the cost differential in memory solutions alone.

You're talking a significantly higher fail rate in manufacturing than Sony's relatively stock solution. It pretty much can't be different because of that ESRAM (a necessity to achieve anywhere close to parity in a bandwidth sense).

 

[truth411]

They do have 48 million Xbox live subscribers. That's quite a chunk of revenue every year. But then again, they also have thousands of servers to maintain.

The vast majority of those subscribers are not gold users. The last I heard it was around 17 million, but it wouldn't surprise me if that number is falling fast as the PS4 keeps outselling the Xbox here in America.

 

[LowEndTorque]

No, even without Kinect it was still more expensive.

MS somehow managed to build a less powerful, and still more expensive box. I don't know how their R&D team managed that but almost everything about the system has been ond giant mistake

Well from the article: X1 cost $90 more than PS4, Kinect cost $75. So kinectless X1 cost $15 than PS4.

Ya, you’re right, I didn’t read the teardown carefully.

I’m trying to make sense of their math now. They said the X1 APU is $10 more than the PS4’s (which is pretty crazy considering the GPUs). But the RAM is $28 less, which would make PS4 $18 more expensive. But then the X1 power brick costs $25 which would make the X1 $7 more expensive. So $8 difference to make it $15 must just be the headset and/or production and materials.

 

[truth411]

Ya, you’re right, I didn’t read the teardown carefully.

I’m trying to make sense of their math now. They said the X1 APU is $10 more than the PS4’s (which is pretty crazy considering the GPUs). But the RAM is $28 less, which would make PS4 $18 more expensive. But then the X1 power brick costs $25 which would make the X1 $7 more expensive. So $8 difference to make it $15 must just be the headset and/or production and materials.

Hasn't the PS4 GDDR5 already dropped in cost? when they get 8 Gbit chips it should drop dramatically.

 

[Special C]

I think MS is doing this temp price cut to get the console in as many hands as possible. Once they get the user base up and more people realize its actually a really good console and not a demon spawned abomination the word of mouth should improve.

 

[stryke]

Ya, you’re right, I didn’t read the teardown carefully.

I’m trying to make sense of their math now. They said the X1 APU is $10 more than the PS4’s (which is pretty crazy considering the GPUs). But the RAM is $28 less, which would make PS4 $18 more expensive. But then the X1 power brick costs $25 which would make the X1 $7 more expensive. So $8 difference to make it $15 must just be the headset and/or production and materials.

Don't be too focused on the GPU strength influencing pricing in this context. The pricing correlates more strongly with the die space.

 

[LyleLanley]

It doesn't make sense though, when you include the PS4 digital library, the PS4 game library is bigger than Xbox. M.S. is making these deals because they have to in attempt to remain competitive in there home market. If M.S. raise the price back to normal in January, there sales are going to collapse, I guarantee you that M.S. wish they were in Sony's position right now. M.S. is arguably devaluing there box just a year after launch, not a good position to be in.

I feel like you're responding to a different post.

 

[truth411]

I think MS is doing this temp price cut to get the console in as many hands as possible. Once they get the user base up and more people realize its actually a really good console and not a demon spawned abomination the word of mouth should improve.

Serious question, what do you think sales will be like if the raise the Price back up, and slow down on all these bundles there doing for the holidays?

 

[Palocca]

I don't think they are losing that much on each console sold though. They were making a profit at $500 then dropped the kinect and are selling it separately for $150, so at $400 I'd say they are making even more profit per console than at launch. You do have a point with R&D though I didn't think about that when I posted.


Though I'm sure they are making a loss now with the price cut and all the free games and I doubt they wanted to drop the price or get this "desperate" as they probably expected to run away with this gen, but it was needed really otherwise the console would have fallen even further behind the PS4 which would have been even worse with less people to sell games/live which is why IMO companies should sell consoles at a loss to begin with..Then again I don't and never will own a successful gaming company so what do I know lol

On the bright side.. I just got membered, Thanks whichever admin!

Congrats!

You're probably right in that the price cut was a necessity in order to remain competitive... I just don't envy the position they're in right now haha.

 

[dEvAnGeL]

I think MS is doing this temp price cut to get the console in as many hands as possible. Once they get the user base up and more people realize its actually a really good console and not a demon spawned abomination the word of mouth should improve.

i have 3 friends that traded in their old console at BB and got an xbox one and damn are they regretting it, cant speak myself about the console cause i don't have one but they tell me the UI is slow and clunky compared to the ps4, that is to busy, way to many things on screen, seems like they're not happy at all

 

[pastrami]

Thanks for the fair post.
I haven't been fooled though, i just find it hard to believe there would be 3-4mil X1's sitting on store shelves.

The mistake is assuming that Microsoft have shipped nearly 10 million consoles. That isn't what their PR said. Their PR said "Shortly, we will have sold in to retailers more than 10 million Xbox One consoles." We have no idea what time frame "shortly" entails, and it's impossible to derive how many consoles they have shipped AT THIS MOMENT from their statements.

EDIT: On that note, I now find the thread title misleading.

 

[BlackBuzzard]

Serious question, what do you think sales will be like if the raise the Price back up, and slow down on all these bundles there doing for the holidays?

Sales will plummet for the first 3 months of 2015. People will just wait for the next deal.

If its temporary its really a double edged sword.

 

[LowEndTorque]

Hasn't the PS4 GDDR5 already dropped in cost? when they get 8 Gbit chips it should drop dramatically.

Good point. I’d wager the production of 8GB GDDR5 in a single slot will coincide with a slim model and price drop to $299. Not only will the RAM cost less, but so will the die. Sony is probably in a much better position to cut costs and drop price over the long run.

 

[biggersmaller]

Only if we get to see fistacuffs with Bill Gates, he's actually a lot more of a heavyweight than he looks. Secret muscles and stuff.

 

[stryke]

Jacking up the price again would be a terrible idea.

 

[Tsiawd]

i have 3 friends that traded in their old console at BB and got an xbox one and damn are they regretting it, cant speak myself about the console cause i don't have one but they tell me the UI is slow and clunky compared to the ps4, that is to busy, way to many things on screen, seems like they're not happy at all

That's odd. all of my friends who just got one love it and is the fastest UI they have ever used. To each his own I guess. I do personally agree that it is too busy though and some things need fixing. I do regret purchasing Halo: Master Chief Collection, but I found a good use for it.

 

[Biker19]

For those of us who can actually remember where PS3 was at this point in it's life, your post seems kind of laughable to be honest.

PS3 year one was garbage, shitty exclusives, worthless multiplats and online... it was the shitshow to end all shitshows those first couple of years.

PS4 year one will most likely be remembered as merely 'unremarkable' at worst when all is said and done.

That seems like quite a step up to me.

Yep. That's a big difference. Even the 1st year of both PS1 & PS2 weren't that terrible compared to PS3's 1st year.

 

[jedimike]

The vast majority of those subscribers are not gold users. The last I heard it was around 17 million, but it wouldn't surprise me if that number is falling fast as the PS4 keeps outselling the Xbox here in America.

Before Microsoft started offering free games for gold, the percent of Gold users was "over 50%". I can't imagine that number dropping as Microsoft has continued to add more value and also since the competition now has a paid service.

 

[Avatar1]

That's odd. all of my friends who just got one love it and is the fastest UI they have ever used. To each his own I guess. I do personally agree that it is too busy though and some things need fixing. I do regret purchasing Halo: Master Chief Collection, but I found a good use for it.

Fastest ui??? Lol!!! I have both. Speak what you will about preferences but the ps4 os is lightning fast. You can get to anything major in seconds. The bone os is laggy by comparison. The bone has other strengths so I'm not tearing it apart here but it's nowhere near as fluid as ps4.