Analyst: Xbox One policy reversal a "good first step"

Sterne Agee analyst says revised strategy "more consumer-friendly," but Microsoft still needs to focus on pricing messaging.

by

Microsoft's revised Xbox One policy is a "good first step," but the company must now focus on communicating to consumers why they should pay $500 for the system instead of $400 for a PlayStation 4, according to Sterne Agee analyst Arvind Bhatia.

"Microsoft's revised Xbox One strategy is more consumer-friendly and bodes well for potential sales of the console over time," Bhatia said in a note to investors today regarding the impact the news has on retailer GameStop.

"The elimination of all restrictions related to DRM and trade-ins, etc., strengthens GameStop's positioning in the space and eliminates risk to used games," he added. "Still, we believe Microsoft's messaging on Xbox One pricing ($499) needs to improve relative to Sony's PS4, which is priced at $399."

GameStop yesterday applauded Microsoft's policy reversal, saying the move was "great news" for gamers and is a testament to Microsoft's understanding of the importance of the used-game market.

Microsoft may be pacing ahead of the PS4 on Amazon's best-seller charts, but Bhatia believes the company must now focus on pricing messaging to win over consumers who may be attracted to the PS4's lower price point.

Bhatia pointed out that the primary difference between the Xbox One and PS4 is that Microsoft's system comes bundled with a Kinect camera, while Sony faithful will need to pay $60 to buy a PlayStation Eye peripheral. Communicating to gamers why the Kinect will add value to the system will be the difference-maker, Bhatia said.

"The primary difference is the Xbox One comes with a Kinect camera/controller bundled while PS4 does not," Bhatia said. "We believe Microsoft wants to bundle Kinect so developers can take advantage of its features without worrying if the end-user will have the Kinect controller or not. As such, the messaging likely needs to focus on the value and potentially differentiated game play provided by Xbox One."

Discussion

485 comments
bobtheonlybob
bobtheonlybob

I posted my comment below in 2 other articles but I had to do it here as well.  Also, Kinetic_Warfare has to be fake (sorry if your not but I've seen MS do the fake thing way to much). Shame MS, shame:

Anyone else notice how the newest post in a thread is usually someone being positive of MS, kind of as if MS lackeys wait for the thread to be over and then post something.  And usually it's positive but with a small criticism so it doesn't look fake (although the username usually is so generic that it looks fake).  Just something to think about.

 Oh and for the record, nothing MS can do will erase "we have an alternative for those who can't connect, it's called the Xbox 360"(not an exact quote).  That is what MS really thinks of us.  Getting Titanfall for the PC, all other good games are multi so PS4, Wii U, or PC (which most games will be better on anyways).  

 PS, not an Sony fanboy, this gen: 360, PC, and Wii.  Just calling it like I see it.  MS you screwed up.  Let's hope Xbox TWO and Win9 are better.  Our collective wallets Dealtwithit

Kinetic_Warfare
Kinetic_Warfare

Here is the $100 bucks difference:

Ok, I believe that you have seen the games.

So apart from the games & exclusives:

New things on xbox:

1. Cloud computing; the ability to compute & process partial game contents that devs can offload to the cloud live. This can be used in many many ways, from helping up with rendering & props processing thus meaning more console potential & speed, to new ways of sharing content, new game functions, and new types of games. One example is the "Driveatar" in forza 5. Basically, devs can create bigger and better games which evolve & expand, where the AI learns directly from the players and react respectively. - Cloud computing is not to be understood as "Cloud data storing" like on other platforms or systems.

2. The tv viewing/ programing-your-tv-preferences/ sharing tv content stuff you may already know.

3. Game DVR /video editing in studio /sharing.

4. Improved voice commands and gestures with the kinect 2.0 - You can program various things and control them with your voice in order to navigate easily through all your media including games/tv/music/pictures/videos/streaming/chat/apps/etc. Also it comes with an 1080p full hd camera.

5. Multiple apps like Skype/ twitch (this 1 alone allows yo to share, stream or remotely play your friend's games)

6. Snap mode: Switch between your content quickly or multi task while gaming/ viewing a video /browsing with voice commands or your controller.

7. The new xbox one game controller with 40 improvements including the "rumble" feature in the triggers.

8. HDMI in port - This can be used for multiple purposes not yet know, however MS has mentioned some like; Connecting your tv provider system / your laptop / your xbox 360. Basically you can connect in (and use maybe with some app?) anything that has an HDMI out port, even a ps4 hehe, who knows... =).

9. Major upgrades on Xbox Live; from 2 free downloadable full games every month to the inclusion of more than 300,000 servers worldwide (they had 15,000 servers before this) to support cloud computing and to provide the best and most reliable gaming network in the world.... its true.

10. New sports control center with stats/teams/live games/fantasy sports /etc.

- MS said there are many more new features going to be shown in the next months until the launch, one of those was the "10 buddy complete gaming library sharing plan" - but with the DRM and check ins gone, its gone too.

So there you have it.

$10 bucks per each new feature makes the $100 difference with the ps4, not to mention the exclusive games, or the new features to be announced. =)

Born_Lucky
Born_Lucky

In other words - no one wanted the kinnect, so Microsoft is forcing it on people.

Another brilliant move from the people that brought you a tablet OS for your desktop.

SoulxReaperx366
SoulxReaperx366

As long as they take more than the first step... besides, with the navy, it doesn't help them much because you still need to check it in online before you can use it.

TruthSerum808
TruthSerum808

If  Microsoft drops the Kinect requirement then I will probably stick with the Xbox platform for the next generation. If they insist on having the Kinect sensor plugged in to the system then I will definitely get a PS4 instead. Its as simple as that. 

Doddie
Doddie

So what happens when after purchasing an Xbox one.  Will MS then change their policy again back to "I spy"?????

Hozzyboy
Hozzyboy

xbox for life! the takeover is near.

mediarays
mediarays

One last step remaining to take the lead drop the price and win the war

Dangerous231
Dangerous231

I think its a good thing that MS changed their policy's for those  gamers without internet. but at the same time I think that move may  do nothing more  but hold the industry back for the future .I mean if the gamers of 2001 were as  connected and  discounted from the main picture as gamers are today we would all still be stuck with weaker dial-up and  never made the big jump to broadband because their so scared of change.. and can only so whats infront of their eyes and with that fear only think of dooms day scenarios.. for always connected even know xbox 360 is always connected most of the time anyway

tapiyuki
tapiyuki

I was a big fan of xbox. but i feel microsoft disrespect the fans. Ms mentioned that they changed the policies because of our feedback but actually because of Sony. just so disappointed.

rancidbeast121
rancidbeast121

The thing I don't understand is why they took away family sharing they can still do this with digital downloads for games but no they want to blame gamers and start a fanboy flame war

00LiteYear
00LiteYear

It's not really $500. More like at least $560 because membership might as well be mandatory.

emonumber1
emonumber1

I hope that I don't have to listen to peoples awful Kinect mic like I do on the 360.  They never calibrate them correctly and just leave you there to listen to their TV and grandmother yelling at them in the background.  WORST idea ever!!!

Rev1t
Rev1t

Wow, that's how you respond.....getting personnel are we....your pretty clueless aren't you?

Why the hell do i even respond to a dumb fanboy.

nousername66
nousername66

Why not let consumers decide if they want Kinect? Again, not a consumer-focused idea by forcing it on people.

johnritter4141
johnritter4141

why is DRM such a bad thing? i mean if someone works hard to create something,why shouldnt they recieve all the benefits? isnt eceryone else,gamestop, for eg a leech?

Bond_Villain
Bond_Villain

LOL, why are people still moaning about the Kinect???

If it's such a big deal "OOOH ITS WATCHING ME .. OOOOH IM SO SPECIAL THE ILLUMINATI MUST BE WATCHING ME EVERY MINUTE THE CAMERA REC LIGHT IS ON EATHING ME FAP OFF IN MY TIN FOIL HAT ooohh"

-- take your soiled underwear and drape it over the thing. Done.

steve4123456789
steve4123456789

The fact that they tried skynet still can go fuck themselfs.

panaicman66
panaicman66

@bobtheonlybob wel said bob, after reading Kinetic_warfare's post i can see where you coming from, does seen a bit suspect.

Also, like i've said on another site regarding their pricing of not only the X-180, i had noticed that the rechargeable batteries for the 360 can only be bought now with a charging cable, which costs more.

Why would i buy a battery pack for wireless controller with a cable that i have to connect it to the console???

I've been a Xbox fan since the beginning with halo, but im either staying with my 360 or buying a PS4


panaicman66
panaicman66

@Kinetic_Warfare  All i have ever wanted was a next GEN games console that plays next GEN games with PC graphics. Not a silly box of tricks that can control my TV programmes, and other silly crap i'm not interested in.


Also i would like to know how many people who have a games console, whether it's a Xbox or Sony, have the space to use the Kinect system correctly.   

I know a lot of people who have their consoles in a small room where there is sitting room only, so using a Kinect would not work if it needs to see the lower half of the body.

mlavinder
mlavinder

@SoulxReaperx366 Right, so you think you can actually buy an Xbox where Internet is an issue?   No.  The point is they could not buy the console in the states and take it with them to locations with no Internet.  

Yes, they will have to activate it before they leave.  That's new to consoles but not a new problem.  Windows and other software has to be activated ahead of time, so the activation, while inconvenient, it isn't a deal breaker.

adamg78
adamg78

@mediarays  the only way the price will drop if xbox one  comes without kinect.   without it xbox one would be the same price as PS4

DWalker131
DWalker131

@Dangerous231 If you watched AJ's interview with Major Nelson he said Microsoft wanted all games to be digital, "digital gaming is the future", the problem that i have with that is the current internet is no way near ready for something THAT dramatic, and i'm sure people feel the same, a few weeks ago "uncharted 3" came out for PSN plus, it was about 30 GIGS, it took me around 12 hours to download it, now if your internet manages to download that 30 GIGS in a fraction of the time, then you won't see the problem, but if you work 8 hours a day, come home and you want to play a new game which retailers are advertising at $119 (yes i know thats not the final retailing price) so you turn on your console buy a game for $119 then the console tells you to wait 12 hours for the game to be downloaded i'm sure everyone would be gutted

@GravityX you know who made the exact same comment as you ?  Don Mattrick who told people with internet issues to buy a 360 and the beloved Adam Orth who thinks the internet is as reliable s night and day, when in reality the internet is about as reliable as windows 98 (yes a BSOD zing) and the public don't look at them very favorable at the moment take a wild guess why

 i say digital only gaming might work once ISP can allow you to download 30 GIGS in 5minutes, otherwise i find it pretty hard to argue otherwise

scuba52
scuba52

@Dangerous231 I agree with you but I do believe that they should have implemented this in stages and not all at once. What they are doing is the future in gaming but all at once scares the herd into a stampede.  To have the option of offline and always online would have instilled more confidence, and allowed service members and people in foreign countries the ability to get it. Have the online option give you all the benefits and offline just game console would have been welcomed by the community in my opinion.

GravityX
GravityX

@Dangerous231  You are absolutely right. All the whiners are gimping the nex generation. If you are not ready for the future just stick with this gen.

Ninja_RaVeN
Ninja_RaVeN

@tapiyuki What are you talking about? They Did it so they can get back the customers they lost from the E3 Fiasco. Did you wan't them to keep there original E3 policy? 

Tech9
Tech9

@rancidbeast121 no, they can't keep it.  this was based on the "always online" method - you know the 24-hour check-in policy.  with the NEW policy, you could share the game and the user could take it offline and potentially play it forever. then you could do the same thing with more users and more games.  

danielmbg
danielmbg

@nousername66 It's because its easier for companies. If everyone have a kinect, they can easily use it on games. They want companies to use it.

Tech9
Tech9

@steelmouth if that seriously is how it worked, wow.  we really got shafted going back to the old way.  i always thought MS would just explain the message better and not backpedal.  whatever, i doubt they will reverse it again...

emonumber1
emonumber1

@johnritter4141 I can deal with DRM in terms of how EA did it with their multiplayer, but  I will not buy a game with DRM over the entire thing.  Let alone the entire console.

Divedude
Divedude

@Bond_Villain At least right now I have the option to now buy the Kinect since I never use it. XBox One I dont have the option. 

SoulxReaperx366
SoulxReaperx366

@mlavinder not if they have to activate it every time they get a new game. Which I'd need confirmation on that because I'm not 100% sure they're doing that. And how do you know it doesn't need a connection each time it's unplugged and plugged back in, like if you moved or you sold one on Craigslist? You think there's no way MS would try that

osxgp
osxgp

@ThereWillBeNPCs No, they got rid of the 24hr check in but the console needs to be online for the initial load up. Also from my understanding, every new game requires the console to log online the first time as well. 

Ninja_RaVeN
Ninja_RaVeN

@00LiteYear If you want to play Online multiplayer on the PS4 you have to pay a subscription fee.