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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iBulletPosted:

It's $599 in Australia which equals out to around the same in USD, we're getting ripped off.

AustraliansPosted:

I guess this guy is right about the price, but if it was to low there would be problems and i can understand that.

KatsumiPosted:

UJelliBro
Liquidvlade
Monster-Munch
daw
Recline Yeah the price is kind of ridiculous. For that price it should include 2 games of your choice and a year free of xbox live.


Wasn't there a rumor that you get a free year of live ?


I think there was.


Day One Edition does include a year of Xbox LIVE.

So 100$ for a Kinect 2 and a year of Xbox LIVE? Sounds awesome to me!


No that was a rumor thats been confirmed false . You have to buy your own live it does not come with a year


That is expected. If Microsoft simply gives their customers one year worth of Xbox Live membership they will end up loosing a lot of money

UJelliBroPosted:

Liquidvlade
Monster-Munch
daw
Recline Yeah the price is kind of ridiculous. For that price it should include 2 games of your choice and a year free of xbox live.


Wasn't there a rumor that you get a free year of live ?


I think there was.


Day One Edition does include a year of Xbox LIVE.

So 100$ for a Kinect 2 and a year of Xbox LIVE? Sounds awesome to me!


No that was a rumor thats been confirmed false . You have to buy your own live it does not come with a year

ConvergePosted:

This price really is reasonable in this current economy. Microsoft should listen to professionals

TFMPosted:

Katsumi I don't really think $500 is too high for the console with Kinect included. It would be good if Microsoft could drop the price a little though.


Yes it would be.

KatsumiPosted:

I don't really think $500 is too high for the console with Kinect included. It would be good if Microsoft could drop the price a little though.

LiquidvladePosted:

Monster-Munch
daw
Recline Yeah the price is kind of ridiculous. For that price it should include 2 games of your choice and a year free of xbox live.


Wasn't there a rumor that you get a free year of live ?


I think there was.


Day One Edition does include a year of Xbox LIVE.

So 100$ for a Kinect 2 and a year of Xbox LIVE? Sounds awesome to me!

USCGPosted:

Its seems a bit much!

ErebdraugPosted:

I still can't get over the prices for the UK. Damn companies thinking we don't know exchange rate.


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