Microsoft Concede That Console Sweet Spot is $199 Page: 1
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Microsoft: Console Sweet Spot is $199

Yep you've read that correctly...Microsoft concedes that the console sweet spot is in fact a mere $199. Now just don't expect the XBOX 360 to get anywhere near that in the short term.

Admittedly, Microsoft has achieved success over Sony purely because it had a year's head start and developers have had more time to code for the system. But not content to rest there, Microsoft intends to wear down some of Nintendo's market share at the cheaper end of the market.

While Microsoft may be pleased with itself on keeping Sony’s PlayStation 3 at bay, now the company must focus on stealing some of Nintendo’s thunder. The Wii’s innovative remote controller allows it to attract a whole new audience, such as women and the elderly, to play video games. In order to rule this console generation, Microsoft believes that it needs to start emulating some of Nintendo’s tactics. “If we don't make that move, make it early and expand our demographic, we will wind up in the same place as with Xbox 1, a solid business with 25 million people,” said Peter Moore, a Microsoft marketing VP. “What I need is a solid business with 90 million people.”

Microsoft further intends to take a more family friendly approach to the marketing and development of games for the XBOX 360. I know as a father of three small children, the lack of suitable games for the younger audience was a significant factor in deciding which console to purchase.

“If you don't start building that content and reputation it never comes,” said Albert Penello, director of Xbox global platform marketing. “I don't want to be pigeonholed as a hard-core machine.” Microsoft also may do something about the price, as it sees the Wii’s relatively lower price point of $250 as a “strong value proposition,” said David Hufford, a director of Xbox product management.

“When mom walks into the store and sees she can get a console with a game for $250, she sees it as a $300 value,” Hufford said with regards to the Wii. “They've done a good job.”

Microsoft may be looking at a price below $200, as Hufford says, “We are well aware that the sweet spot of the market is really 199 bucks.” According to the story, Sony sold 75 million PlayStation 2s at or below $200, making up about 80 percent of all PS2s sold.

Please be aware that this isn't a hint at an impending price cut from Microsoft on their XBOX 360 console... Microsoft's 360 and Elite consoles are still selling extremely well, and are further reinforced by a solid selection of games.

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