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RUMOUR: Next Gen Consoles To Release For $400

Author:
Matt Gardner
Category:
News
Tags:
Analyst Predictions, Microsoft, Next-gen, Nintendo, PS4, Sony, Wii U, Xbox 720

RUMOUR: Next Gen Consoles To Release For 0

There have been a number of juicy things to emerge from CES, and hear comes another little whisper from behind the closed doors of the show. We don't often cover the mutterings of analysts on this site, but this one seems worthy of discussion.

Having spent a good deal of time at the show "with a number of companies involved in video game development and distribution", Baird Equity Research suggested to potential investors that new console hardware, believed to be unveiled just ahead of E3 this year, will retail for $350-$400 in the US.

"Given the fragile state of the console game market, we expect the E3 trade show in June will take on added significance, most likely providing the industry with the first public opportunity to examine next-generation hardware," wrote Baird's Colin Sebastian in a missive to investors.

"Our checks suggest that next-generation console hardware will be largely built from 'off the shelf' high-end PC components, along with hybrid physical/digital distribution models, enhanced voice controls and motion sensing (Kinect integration with every Xbox), and broad multi-media capabilities.

"Moreover, a PC-based architecture (Intel chips in the case of Xbox) should have a number of advantages over custom-developed silicon: for one, the learning curve for software developers will be shorter than completely new technology. Second, the cost of production and retail price points should be lower than prior console launches.

"Third, it will be easier to build online services around PC chip architecture, including flexible business models (free-to-play, subscriptions) and multi-media (over the top) content offerings. For Microsoft, this design will also allow for more integration with Windows 8 and Windows Mobile devices," he went on.

According to GII, Sebastian earmarked October for Sony's launch, with Microsoft following suit in November, though he noted that his "field checks" had suggested that there "may be early production issues with Sony's PS4."

And what of Nintendo? Well, Sebastian suggested that the Wii U's somewhat quiet launch pointed towards the Big N being a fringe player in the next generation.

"We remain concerned that Nintendo's innovative Wii-U console will lack broad appeal beyond the core Nintendo fan base," he stated.

"Following a somewhat lackluster [sic] launch and holiday selling season, Nintendo will need to bring to market major first-party releases (Zelda) and retain the support of key third-party developers to reduce market share losses. In a negative scenario, Nintendo will be forced to prematurely lower the Wii-U price, and over the course of this cycle, we expect consideration will be given to extending first party franchises to other platforms."

Add a comment8 comments
sits69  Jan. 14, 2013 at 16:24

In a negative scenario, Nintendo will be forced to prematurely lower the Wii-U price, and over the course of this cycle, we expect consideration will be given to extending first party franchises to other platforms.


Given the falling manufacturing costs for tablet screens, and Nintendo stating that (similar to the Wii) the Wii U is profitable after a single-game tie-in, I very much doubt Nintendo will go multi-platform like Sebastian suggests.

Nintendo 'defensively' prices their consoles like such, ensuring they'll be a going concern even if they were coming a distant third, ie. even if they're not selling too many Wii U's, Nintendo would still be profitable with their core fanbase. Going multi-platform would cause more long-term damage to their brand (not to mention lose them the ability to dictate publishing on their own terms) by appearing on other systems.

To even think they'd go multi-platform reveals one lack of knowledge of the industry, Baird's Colin Sebastian, Industry Analyst.

Last edited by sits69, Jan. 14, 2013 at 16:30
Quietus  Jan. 14, 2013 at 16:44

$400?

Well, with the usual console exchange rate, that'll probably be £379.99, then?:p

DivideByZero  Jan. 14, 2013 at 16:50

£379.99 is still cheaper than my day 1 PS3 60GB.

Anarchist  Jan. 14, 2013 at 19:57

Or most other consoles, if you factor in inflation.

Late  Jan. 14, 2013 at 21:57

I'd expect £350 (inc. VAT) in the UK if it's $400 in the states - which sounds fair enough in terms of price. All depends on what's in the box etc. of course.

TheCheadley  Jan. 15, 2013 at 10:55

I'd expect £350 (inc. VAT) in the UK if it's $400 in the states - which sounds fair enough in terms of price. All depends on what's in the box etc. of course.


What would be fair would be a proper exchange rate being used. I fail to see why we have to pay than our across the pond cousins.

DivideByZero  Jan. 15, 2013 at 14:28

According to the internet (and so must be true)

PS2 - US$ 299 (then dropped to US$ 199 to stamp out competition) - they were first released at UK £300... 1:1 with the US ignoring the exchange rate (and the fact it cost more in the UK)

PS3 - a 20 GB model and a 60 GB model, priced at US$499 (€499) and US$599 (€599), respectively. The UK got the 60GB for £425 on release day (I got mine at this price and still have it). This was about the same, taking the exchange rate into consideration.

Given the global recession, I am not sure how many gamers would be prepared to be ripped off this time round. If they ask £400 when it is $400, more people than usual would say "lets wait till it drops in price".

Late  Jan. 15, 2013 at 20:05

At current exchange rates $400 is £249. Adding £30 for shipping and the UKs generally higher markups takes it to £280. And VAT takes that to £336.

Of course the quoted US prices are before US state taxes - the Yanks will pay more than $400 if $400 turns out to be the launch price.
We pay slightly over the odds over here, but not to the degree the tabloids like to make out...

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