Xbox One at $499: “the price is too high”, says economist

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Xbox One will cost $499 / £429 at launch in November, but the cost of entry is too high, economist and author Rafi Mohammed has cautioned. He has stressed that a low console cost would result in more players investing in Xbox One games in a new interview.


Mohammed has worked as a pricing analyst for some 21 years and is author of a book called The Art of Pricing. If there’s one thing he appears to know, it’s how to price a product successfully.

Speaking with Bloomberg TV, Mohammed said of Xbox One, “You want to get that console in consumers’ hands, and then where you really make the money is off of the games.

“So it was really surprising that they charged such a premium, especially when they had a lot of negatives…like the very restrictive DRM, which they did retract from. One of the key things is that they really listened to their consumers and they did backtrack and they reduced the price, but I still think the price is too high. So it’s still a $100 premium.”

Despite the $499 asking price, Microsoft’s Don Mattrick has recently suggested that Xbox One over-delivers on value, and offers thousands of dollars worth of content and features. We’re still not sure what ‘over-delivering on value’ means exactly.

Posted:
Related Forum: Xbox Forum

Source: http://www.vg247.com/2013/06/24/xbox-one-at-499-the-price-is-too-high-says-economist/

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"Xbox One at $499: “the price is too high”, says economist" :: Login/Create an Account :: 221 comments

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LiquidvladePosted:

Personally I think it's not a bad deal, specially if you pre-order.

For that extra 100$ you get

- Kinect 2
- 1-Year Xbox LIVE (60$) (I really see it as 30/35$, I always buy them online)
- Some Day One DLC
- LE console

I know the last two are not very impressive, but still cool. 1-year of LIVE and the Kinect are worth 100$.

Personally I think that by everyone being forced to have the Kinect, the developers will put more effort to make something decent and move away from gimmicky games. For example, why would YOU work hard for something that won't be experienced by everyone? Now that it's included, devs will do something awesome with it for sure.

Sony did a good move and a bad move not including the PS Eye, yeah it sure helps it's cheaper, but most gimmicky games on the PS Eye will continue.

DeadMousePosted:

It is too high.. at least make it workable without the kinect and drop it down $100

DunPosted:

I was going to try and get the Xbox One. I still need to get Battlefield 4, GTA V, Saints IV, and Watch Dogs all for the Xbox One.

That all adds up to about $740. I'm disappointed :(

ZeffPosted:

I wish i could just buy the xbox without that stupid kinect that nobody wants.

MarluxiaPosted:

yeah the price it too high for a horrible console

AAmbitionsIsBackPosted:

They need to make the kinect seperate, if possible, which i wouldn't know why it wouldn't be. That would take off like a 100 dollars if it were to be the same price basically as the last kinect, i may be wrong with the price. But that would make the Xbox one a for sure buy for me if it were 400 because i could care less to use the kinect. I used it at my friends house once and it was dumb. And if they made it seperate you would still be at to get it at a later time if you wanted. They could easily make a bundle with it and without it

kal45Posted:

-Tam 350 should be the price


Yeah that would be a good price, what I don't understand is even if they take a loss on the console, they still will make billions of dollars. One year of Xbox live would make up for the loss and also they would still make bucket loads of cash from games. So if I were them I would lower the price to compete with Sony and take a small loss on it and make it up by having more people buy the console and pay for Xbox live.

KatsumiPosted:

Smurfs I'm probably getting it but I think the price is a little high.


This is more or less the case with most consumers. Even though they know that the price is a little high they are going to get it either way

kal45Posted:

Busselton
Sashagrey The xbox is only 1 weeks pay if you have a decent job so not too bothered, still not the point though but ya maybe they'll lower it maybe they wont.


I doubt most people on here have a job lol, well the young ones. I work at IGA so thats an easy 1 week pay, but half of my weeks pay goes towards my life savings for university, so I don't know yet, I haven't even pre-ordered it yet D; :D


"One weeks pay," people have to pay for rent, their car loans, gas, food, electricity, water, Internet, ect. So I would think all of that money would be gone at the end of the week.

SmurfsPosted:

I'm probably getting it but I think the price is a little high.


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