According to Activision Inc CEO Bobby Kotick Video Game Consoles must fall below the $200 mark to be appealing to the masses. The PS3 - although a good product is highly priced at $400. The cheapest XBox is worth $280. The Wii from Nintendo is leading the pack in price positioning at $250.
The fact that the Wii is not so technically complex may not matter so much to the consumer. It provides great entertainment for the price. According to Kotick, the masses will adopt a video game console at a price point of $199.Falling price points are a bonanza for video game publishers. They then have a larger base of gamers to sell to. This is why companies like Activision want video game prices to fall. Sony was forced to slash prices due to lacklustre PS3 sales earlier in the year.
On the other hand Nintendo has sold out at its price point of $250 and is faced with the problem of greater demand than supply. It’s games have attracted women and older people as well as young males. This high demand for Wii’s has led frontrunning game publishers to change from making games for other consoles to making games for the Wii. However most Wii games are made in-house by Nintendo.
So with the video game console prices likely to fall to $199 in 24 months which video game console will be the most popular? I am placing my bets on the Xbox’s.
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