Feature Article

Xbox One price drop: How will this affect the console war?

Editorial: GameSpot's editors discuss what the Xbox price drop could mean for Microsoft as they work to surpass Sony.

Microsoft announced a $399 version of the Xbox One sans Kinect today--bringing it in line with the current sales frontrunner PlayStation 4. And even without an Xbox Live Gold membership, Xbox owners will finally be able to access entertainment apps like Netflix and Hulu.

The comments for those stories, and our interview with Xbox boss Yusuf Mehdi, are a minefield of dissenting opinions, and the GameSpot offices are no different. Was this the right move for Microsoft and will it be enough to give them the edge on the PS4?

Edward Makuch - Fan Dialogue

The unbundling of Xbox One with Kinect is not only meaningful because it brings the system on par with Sony's PlayStation 4 from a price perspective but also because it shows Microsoft is continuing to listen to fans. Not that you needed a reason to doubt Microsoft's willingness to do so. The unbundling of Kinect is the second dramatic reversal for the Xbox One in under a year, following the company's decision to do away with many controversial policies last summer after fans spoke out in protest.

When I asked Microsoft's Albert Penello in August 2013 if he thought the Xbox One's then-$100 price premium over the PS4 would be a deal-breaker for some, he shrugged his shoulders and said no. What a different--and encouraging--narrative we're hearing today. Today's news should help Xbox One sales pick up, and it couldn't come sooner. At 5 million units shipped, the Xbox One is lagging behind the PS4 (7 million) and the Wii U (6.17 million) in the worldwide sales race. If Microsoft's E3 2014 showing next month is strong (and they say it will be), it, coupled with the price drop, might serve as a one-two punch that could turn the tides in the battle for the living room.

Kevin VanOrd - The True Value of the Xbox

I've often said this about games, but it applies to consoles, consumer electronics, and most other products as well: "value" is more than just how much something costs. For instance, when shopping for a new television, I'm not looking for the least expensive television--I'm shopping for the best value based on my perception of what's important. Does it have 3D capabilities? What's the refresh rate? Does it have built-in support for YouTube, Netflix, and so forth? What other features does it have, and how do they improve my viewing experience? If I perceive additional value, I don't mind spending a little bit more.

Microsoft's problem is not price--it's value. You can, of course, improve an object's value by reducing its price, but from the very beginning, Microsoft impressed upon us that Kinect was a vital part of the Xbox One experience, but they did so without assigning any real value to the Kinect. It's difficult to convince the average consumer that the ability to speak to a console or navigate an interface without a controller is a substantial improvement over using a gamepad or a remote control. In fact, Kinect's reputation for fiddly, imprecise controls had likely convinced consumers that the new Kinect wasn't worth the trouble.

That meant that it was up to the games to give value to the Kinect. And I think we all know how well that's gone.

Considering the upcoming Kinect-less Xbox One sells for $100 less, it's now impossible not to see the Kinect as the sole reason for the console's premium price--and it’s impossible not to assume that Kinect was so unimportant to Microsoft that it reversed course in a matter of months. Now the PlayStation 4 and Xbox One share a price, it's up to Microsoft to convince a skeptical public that it offers the better value, something it never did when Kinect was included. Given the company's mixed messaging, which was apparent from the moment the Xbox One was announced, I'm not sure Microsoft is up for the challenge, though that’s a story for another day.

Thomas Mc Shea - Losing its Uniqueness

What is Microsoft's vision for the Xbox One? If you had asked me this question a year ago, I would have answered that it was a console designed to be everything to everyone, a walled-garden entertainment box that could seamlessly switch between every piece of software we use on a daily basis. But now? Now that Microsoft has pushed Kinect to the wayside and pulled a U-turn on their always-connected ideals? Now the Xbox One doesn't have an identity.

I appreciate when companies listen to the needs of consumers, and chopping $100 off the price of the console is certainly a good thing. However, I do wonder what their long-term strategy is. We know that the PlayStation 4 is designed to play the most technically advanced games outside of the PC with tons of independent fare, and we know the Wii U offers a family-friendly oasis with a controller that offers much more flexibility than we're used to. After Microsoft has turned their back on everything that separated the Xbox One from its competitors, though, it seems like a ship without a captain.

I expect Microsoft to gain traction in the short term because price drops open a door previously locked to the money-conscious public. But how long can that excitement last? Without a strong vision shaping what the Xbox One is, Microsoft is going to keep fighting for relevance as they struggle to define what a next-generation system should be.

Justin Haywald - On the Right Track

I've discussed the importance of price for the Xbox One before, and giving Microsoft's console price parity is not only great news for consumers, it's a necessary move to keep the Xbox One going. Considering the Kinect had the potential for creating experiences you wouldn't be able to have on other systems, it's a little sad the peripheral has to be cut. But we really haven't seen anything that made having the Kinect necessary, and it was ultimately just hurting the Xbox One price point.

More interesting is that this announcement is coming pre-E3. This is a bombshell, center-stage announcement, and Microsoft is getting it out of the way well ahead of their press conferences in a few weeks. What that seems to say is that not only is their show going to focus on games (not on hardware or their Xbox-exclusive entertainment properties), but that Microsoft feels the games they have to announce are more than enough to dominate the show on their own.

I hope that Microsoft continues to incentivize developers to use the Kinect tech in unique ways and that they can turn around the perception that it's not a worthwhile investment. Regardless, these are the kinds of sweeping changes Microsoft needed to enact to make sure that they stand a chance at beating the PS4. Now, what do Nintendo, Microsoft, and Sony have in store for E3? I can't remember the last time I was this excited for the show.

You've read our thoughts, now let us know what you think in the comments below. Is this the announcement that's finally going to get the Xbox One ahead of the PS4?

Written By

Senior Editor, Earthbound fan, and snazzy dresser.

Discussion

1554 comments
n3rdy909
n3rdy909

If your not using your kinect..your a fool. it is a intergral part of the system..entertainment wise its perfect. so much it can..and will do in the future...watch and see...#i luvmyxbox

tim_bizud
tim_bizud

I'm a happy Xbox 360, PC and retro console gamer. I'm also a cheapskate who buys at most 3 new games a year. This is a step in the right direction. I don't really feel a new console has much to offer and honestly feel like my money would be better spent buying a used PS3, but make it cheaper and maybe I'll buy a next gen console...when the right game appears, of course. :)

ericj1989
ericj1989

I've been putting off upgrading my 360 to the one for a while now because of the price and because honestly, for me anyways, the kinect is useless and i have no desire to purchase one. Now that I can buy the console i want without the useless kinect I know ill be making the investment. I've never cared for playstation and don't play pc games. Ive been an xbox fanboy since the original xbox was released

skiggy34
skiggy34

I think this is actually a good thing for MS.... The kinect already proved its value to me.  I dont use it nor plan to use it for games.  I use it for skype, snap and the NFL app this season, and thats it....  I think a lot of people are forgetting that the real reason we buy consoles are for the games...  No PS4 is NOT 2x better than Xbox One.  It may be a little more powerful, yes but games tell the consoles story. If power was what we worried about with consoles, the original Xbox would have blown the ps2 out of the water but because the ps2 had a legendary game library it didnt. Thats where I honestly think MS is going to beat Sony this time around. I own both ps4 and xbox one so I never miss an exclusive but MS is already showing exclusives like never before, Sony is not.

I expect MS to announce The Halo Collection on June 9th to release with the new 399.00 console on June 9th!  

All the 360 owners who still havent jumped to next gen WILL if the Halo collection comes out.  Thats a given.  All my friends that havent gone to next gen yet already confirmed they will buy the kinect less(this has kept them from buying the X1) especially if the Halo collection is out.  I really dont care who wins this dumb console war but I think MS has a great shot.  The Xbox 360 was ahead of PS3 at one point with over 7 million console lead and the ps3 still caught up.  2 million is nothing right now and a lot of things that have kept people from buying the xbox one have now been reduced or removed. Its about to get Real!

kaezramuru
kaezramuru

All of you had some good points some points bleh. Like one person said my Frist gaming console was the Atari with tanks pong and few other games that came with plus it came with 2 controllers not Just 1 like they do now days. But for a couple hundred dollars more you can get a descent to good gaming PC with all kinds of Peripheals even with Blue-ray player for your dvd's and plus you can do alot more with PC that you can't do with a Gaming console. Come on people think about it you pay for subscriptions on the xbox PS (w/e you got) pay for the same ones thru your computer have compared them they the same plus now with Televisions with all these new ports to input thing from your computer to your television wireless keyboards bluetooth capabilities for wireless mouses headsets keyboards joysticks why even bother with a Gaming Console when you got a descent computer that can do all that plus alot more. Yes some of you may flame me but when you sit and compare them side by side a good Computer I will take over any of the gaming consoles and yes I have a PS4 and an X-Box they collecting dust because i got a good gaming Computer and can do the same thing with it that Can do with a gaming console plus Can Do alot more with a Computer that Gaming Console can't do.

wrestlemaniaw
wrestlemaniaw

once this happens I will probably go buy ps4......

ohjtbehaaave
ohjtbehaaave

Make Xbox1 $350 and gamers might start caring.  MS is already behind in the Next Gen race and has to do something to catch up. The price being the same as PS4 will do nothing for sales.  Or do a bundle with a game for $400.  Make it tempting.

magusat999
magusat999

FOR THE RECORD - the author needs to make a correction. It isn't a "Price Drop", its a package change. A "price drop" would have been if they lowered the price on the exact same package (that is - did not remove Kinect). The reason this is $100.00 less is because its missing a $100.00 peripheral - that is not a price drop, Justin. Do people even know what a sale is nowadays???


And $399.00 - STILL too expensive for a game console... ANY game console. The reason the PS3 had a high price was solely due to Blu-Ray, which was an emerging technology that Sony tried to cram down our throats (with some success i might add). There IS NO REASON for $400.00+ consoles anymore, they do not have anything in them that revolutionary or expensive to drive the prices up. The CEO's salaries say it all - they make hundreds of millions of dollars per year - obviously the companies are making a healthy profit and the pricing is pure GREED.

grove12345
grove12345

Smaller, bigger HD, and cheaper. Otherwise $400 will be better spent on PS4 in 2015

TheExxorcist
TheExxorcist

Microsoft can't do any more back pedaling than It's already done. It has given in to all of the controversial aspects of its Xbox One announcement in just six months.

Xbox One banned used game sales and then it didn't. It was supposed to have 24-hour daily check-ins for DRM purposes and then it didn't.

It wasn't due to support indie game developers, and now it is. A plugged-in Kinect was to be required and now it isn't.

It was more expensive than PS4 and now it's not. It had to come with that vital Kinect motion controller, and next month it won't.

There's a minority opinion that some of these ideas were good and that the Microsoft didn't stand its ground when the backlash against its policies started trending on Twitter.

Gamers weren't ready for some of these big changes, but even when the ideas went through, like including the Kinect, Microsoft showed us that it wasn't ready either.

rickyverge
rickyverge

WWE Network streams flawlessly on Xbox One too

rickyverge
rickyverge

Skype, Twitch and direct uploads to Youtube are awesome on Xbox One

dpclark
dpclark

Drop the price to $299 or it's over.

Kashmiro
Kashmiro

The Xbox 360 was a weaker PS3 and was actually the better of the two consoles. I'm not saying the same will hold true, but everyone arguing this ruins the Xbox One are just reaching for something to argue about. Sure, Microsoft announced the console with a dumb conference, but did anyone watch their E3 conference last year? It was wall to wall games, only 1 of which was Kinect only (D4). This seems to me more a product of change in management at Microsoft than anything else. I think they still want to move forward with the entertainment side of things, but also have a strong focus on games. 

HipHopBeats
HipHopBeats

Microsoft tried to be greedy in the beginning with their militant gaming policies which didn't catch on. They've been backpedaling ever since they're to act like they care about gamers. They deserve to be behind. Not saying Sony is the Holy grail of gaming but they are definitely the lesser of two evils.

BradBurns
BradBurns

Sony has been taking it a little too easy, they should have announced some sort of a game/console bundle or something already. If they want to stay ahead of MS they have to strike while the iron is hot. Just look at what happened to Nintendo when they hibernated on their laurels with the original Wii.

kane6911
kane6911

the only reason people want the ps4 is for the graphics not the games because i can attest most of thier games while good looking play like crap. they are laggy and not really smooth at all. the ps4 is just like the ps3 in every way and that's not next gen because it has a 4 and not 3. the price was on par with what it needed to be this time unlike the x1 which was way more expensive but it was a better deal for your money. sony is just a console for right now it will not get that much better with time. while the x1 i can see getting better with time all day long because what the software can do. in lew of all this 399.99 for a x1 is good move. i will buy one now because it cheaper i will also get the camera when available and when it has some uses.    

Flyin3lvl
Flyin3lvl

x box has the exclusives that's a fact....

the part I don't understand is peeps have gone into shops or done their research see which games both consoles have or going to get and still seem to be walking out with the ps4, was price really the only deciding factor?

kinect can still be a success if played out right.... would it really be so bad to do a kinect AND game bundle, something along the lines of the skylanders/ Disney infinity packages where they bundle the pad with two figures.... or buy the kinect and get a game with a discount sort of thing.....

some say this price drop will make it a sub par less powerful ps4, some say the two console will now be virtually the same.... in all honesty I think the ps4 will still the edge and a slight upper hand with the remote play feature which when x1 users bad mouth the 4 seems to forget it has

fair enough you can sit there xbox on, xbox this xbox that xbox tv but I'm sat outside in the sun still playing ps4.....

magiq-mike
magiq-mike

If Sony makes online free to play all of this is for nothing.(I think at some point they will) It will simply be too little too late.

raziel2kain
raziel2kain

it's been a year i don't believe a single word or promise they made. to me they're farting for a year. that's why i call them microFART

hotwog21
hotwog21

drop the 3 operating systems too

Coco_pierrot
Coco_pierrot

Desperate move that prove they are giving up their uniqueness and now it is just a weaker PS4. We will see with their exclusive game but if they are only shooters ... I don't think they have a chance this time. Meanwhile I hope the WiiU gets better because that system as so much potential for unique gaming but people don't want unique anymore it is more about which consol will be best for 3rd party since they are so identical (PS4/XONE)

flaming_in_hd
flaming_in_hd

I'm a Kinect fan and I loved it and I'm disappointed they're unbundling it. So what now? What will happen to their real vision? I guess nothing. Too bad we will not see the true potential of Kinect. Xbox will be another ps4 copycat. I thought they're true to their vision with full confidence. This is why I hate sales numbers. So what will be the difference between the 2? I guess nothing. Its just two same boxes with different names . In the end the decision factor would be the number of exclusives. If xbox fails on exclusives department then xbox done. I just wish developers will still support Kinect because I want AAA titles on Kinect and still waiting for dance central 4 and fitness exercises. 

rob9999991
rob9999991

@ohjtbehaaave  The X1 is outpacing the 360 in sales during in the same time frame after release. Gamers care, otherwise the sales would not be roughly five million. Adding lower priced system options, releasing in all the territories that Sony is in, releasing in China and you have a system that will have sales numbers that rival Sony down the line. A $350 price point would be nice, but don't expect that for a little while. At best expect maybe a choice of one the first party release games that are starting to be discounted.

paulsifer42
paulsifer42

@magusat999  You're first paragraph is solid and true.  Your second is flawed for the reason bahamut_au points out.

rob9999991
rob9999991

@magusat999 When I was a child I got my first game console. It was the Atari 2600. I got it five years or so after it was released. It was the most popular at the time but still had Intellivision and Odyssey 2 to compete with. Adding for inflation that system cost the equivalent of roughly $350... for a five year old console. Jump ahead to the 32 bit era and when released  both the PS1 and Sega Saturn were the equivalent to $400 or a little more. They were on par with a decent PC rig when released. Nothing groundbreaking. I know that the new consoles can't compete with higher end PC's but for a console, both the PS4 and X1 are pretty powerful. The price point for these two systems is about right. When both these systems were released last year they were both making very small profits on each console sold (about $20 to $30 from what I recall). The CEO's are not getting rich off these... Especially not Sony's execs...since they all just took a significant pay cut.

bahamut_au
bahamut_au

@magusat999 Except even at these evil greedy prices the companies are still selling their consoles at a loss...

kennythomas26
kennythomas26

@grove12345 The PS4 is $450 here in Canada and I do understand that the system also went up in price in other countries as well.

Romayo83
Romayo83

@grove12345 I bet it won't be $400 in 2015. Let's hope not anyways b/c I want one too.

paulsifer42
paulsifer42

@TheExxorcist  Agreed entirely.  As the article alluded to, they need to find something that would make the X1 unique and desirable.  The Kinect, always online, etc. were unique, but MS made no attempt (or little attempt) to make any of them desirable.

rob9999991
rob9999991

@TheExxorcist To be fair, Sony also tried to get rid of used games and game rentals in the mid 90's when they (and some other companies) sued Blockbuster and other large retail chains. If they had their way rentals and used game sales would be a thing of the past almost 20 years now.  They didn't have a change of heart. They didn't bend to consumer demands. They simply lost that lawsuit. All companies will do whatever they feel they need to increase profit. They aren't necessarily evil, they just want to make more money where possible.


I do applauder MS for attempting more innovation but have to agree with you that many just aren't ready for some of what MS was trying to do.

rob9999991
rob9999991

@dpclark How? Roughly five million units sold to 7 million with 38 more territories to release in, not including China which the X1 will be released first... not even close to over my friend.

rob9999991
rob9999991

@Kashmiro It's always about the games... Good games will always win out. Right now quite a few good exclusives on the X1 and judging by what will be at this years E3 that trend will be expanded on. Raw power is always good, but that in its self does not make a good game.

rob9999991
rob9999991

@HipHopBeats Greedy? How? With used games? You realized Sony tried the same tings years back. They didn't have a change of heart. They lost a lawsuit that kept them from forcing retailers not to sell used games or rent them. Honestly, neither Sony or MS is good or evil. They are both publicly owned companies looking for the most profit and by doing so keeping their shareholders happy. That will always come first. To bring good or evil into the mix is completely irrelevant.

rob9999991
rob9999991

@BradBurns Sony can't. They just reported a 1.6 billion dollar loss with a 78 million dollar loss from the gaming(PS) division. They can not afford to strike at anything right now.

rob9999991
rob9999991

@slappy54 Hey, if Last of Us, new Halo, Uncharted, Gears of War, God or War and Forza came to PC I would be all over a higher end rig......but

RevLux
RevLux

@kane6911 I own most of the games currently available for the PS4 and "can attest" that almost all of them look and play extremely well. In fact, Sony's excellent exclusives and it's PS+ deal are the biggest reasons why the PS3 eventually overtook the 360 in world wide sales last gen.


Early on last gen the 360 had lots of awesome exclusives that gave it the edge over the PS3. Unfortunately those exclusives dried up as the generation went on. The 360 ended last gen with only a handful of exclusive over the previous two years prior to the XB1's launch. I'm hopeful that Microsoft won't make the same mistake with the XB1 this gen. So far this gen. the XB1, PS4, and Wii U each have some incredible games that you can only play on their respective console. I truly believe that any avid gamer with an open mind could see that even if they don't care for the brand or game(s) themselves.



kenmaster239
kenmaster239

@magiq-mike  Another Sony fan who cant wrap their head around the fact that you can easily get a year of xbox live (im sure ps plus too) for 40 bucks almost any time of the year. ... Thats $3.33 a month for a much much much much better online experience. You spend 400 bucks on a console but cant afford 3.33 a month??  Maybe you should stop buying and playing video games if you cant afford to pay for online???? Yes it would be great if it were free, but you know what??  Do some research, and youll see the insane amount of servers MS has for xbox live VS. PS network. Go play on your free, crummy, laggy,  hackers dream of a network. Ill be playing dedicated servers and shelling out an entire THREE DOLLARS A MONTH for a superior service.

bsford
bsford

@magiq-mike  That's one of the biggest reasons why I went from PS3 to Xbox One instead of PS4. They never should have switched to a mandatory pay model -I'm sure they lost a lot of customers by doing so. 

rob9999991
rob9999991

@raziel2kain Without question buy a PS4.... They can have you.... Something tells me PS players will wish you purchased an X1.

thebeachguy90
thebeachguy90

@flaming_in_hd The Kinect product has been around since 2010 and it hasn't brought anything to wow us.  Sure voice commands are cool but it clearly didn't justify the extra 100. It was never going to carry the product very far.  AAA titles for Kinect were never in development in the first place.  Gamers didn't want it, developers didn't want to work with it. It's simply a gaming failure.

bsford
bsford

@flaming_in_hd  The internet ruined it for everyone. Good job Internet (claps slowly)

DWalker131
DWalker131

@flaming_in_hd  not that i'm voting against the kinect, but 'due to popular demands' they unbundled it, so i don't think devs is gonna wanna invest serious time into it for AAA titles, kinect's been around since the 360 up till now and hasn't managed to wow consumers yet....'except that game 'Eden" or something its a shooter, not my cup of tea but i know its a hit along with dance central, other then that its been nothing but constant bashing 

so i think they're giving up

E-Major
E-Major

@bahamut_au @magusat999  also gamespot itself had an article about how it isn't easy to build a gaming pc for $500 much less $400. You get what you pay for and I would rather pay the $400 and get a good console.

paulsifer42
paulsifer42

@rob9999991 @Kashmiro  For sure.  I haven't talked to ANYONE who has said, "Oh, I think I'll get an X1 for all of my entertainment needs."  Gamers are the only ones looking at it, it's gamers they needs to impress first.