EEDAR Weighs In On PS3 Price Drop
So now that the PS3 Slim and long-awaited price cut has been confirmed, we figured the analysts would weigh in with their thoughts.
The first to do so is Jesse Divnich at Electronic Entertainment Design and Research (EEDAR), and he says this new price point "finally makes the Sony console a much more competitive product," although he doesn't believe this will necessarily cause a sudden hardware shift in favor of the PS3. He does, however, see the PS3 competing far more favorably with the Xbox 360 now, and it can even compete with the Wii (priced at $249), as some consumers may have to make a tough decision between outdated hardware and a console that continues to be on the rise and features a built-in Blu-Ray player. EEDAR does expect Microsoft to announce the elimination of the Xbox 360 Pro SKU and the drop of the Elite SKU down to $299. However, Divnich sees this particular price drop as follows:
"However, we just consider this a pseudo price drop. It is no different from Lexus introducing their 2010 models at the 2009 prices and clearing out their 2009 inventories. Sure, there is a better value, in comparison to the 2009 models, but a consumer still needs to be in the market for a luxury car to reap the benefits. A consumer shopping for an entry-level sedan will not suddenly upgrade to a Lexus just because the 2010 models have been released. EEDAR does expect the Xbox 360 to get a small boost in sales in the short-term, but considers any Xbox 360 sales lift to be a positive byproduct from additional marketing and retail circular placements."
EEDAR does not believe these price cuts, as welcome as they are, will significantly increase software sales through the holiday season. "Even if the price cuts from both systems increase hardware sales by over 1 million units through the next six months, that would likely add an additional $200 million to the software bucket and would only increase 2009 sales by about 2% over current trend..." As for "who will win the holiday season," Divnich says it comes down to hardware vs. software, and there's no telling who will emerge victorious right now. And finally, he believes the $299 price point "will likely become the new standard for the next-generation consoles for the next year." Let the new battle begin!
8/18/2009 Ben Dutka