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GamesIndustry.Biz Interview: Microsoft Europe's Chris Lewis - What price mass-market? Part 1

GamesIndustry.Biz writes: "If you'd told Microsoft five years ago that the second Xbox console would be in its current market position, they would have been high-fiving over the cubicles in Redmond. On the surface, Xbox 360 is looking strong, with 18 million consoles shifted, over 10 million subscribers (though not all paying) on the Live service and the strongest portfolio of software amongst current generation systems, setting a new benchmark for entertainment launches with Halo 3.

But the dynamics have changed. Blu-ray, almost entirely thanks to PlayStation 3, has now killed off HD-DVD, of course. This is expected to provide a huge boost for Sony, ending at a stroke prolonged consumer uncertainty. Meanwhile, despite 360's strengths, PS3 has been catching in many areas, even overtaking 360 in several major continental Europe territories. Has the momentum shifted?

Microsoft's aggressive price-cutting of all 360 models in Europe earlier this week is its gamble to once again derail the accellerating Sony juggernaut. With the lowest-spec model now even cheaper than Nintendo's casual-conquering Wii, Microsoft is banking on this move finally giving it the mass-market traction it so craves. Now overseeing all of Microsoft's entertainment business in Europe, Chris Lewis is spearheading this bold new push across the continent. Here he explains why Xbox can still win."

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Cyrus3653235d ago

It shall be interesting to see how the battle in europe plays out.

DarkSniper3235d ago

If, still, possible, can we are all worlds of hopeless defeat in the category of failure. Microsoft fits this category perfectly.

$niper

kspraydad3235d ago

Europe sure is 'chatty' all of a sudden.

DJ3235d ago

Which beckoned their recent price cuts, but yeah, I don't remember ever hearing a word out of Microsoft's European division. Maybe it's just me, but price cuts only work down to specific price ranges depending on the age of a console. The fact that a 360 costs probably twice as much to build as a Wii, is significantly more powerful, and yet is priced lower than Nintendo's hardware just seems troubling.

Sony's decision to drop to $399 was an absolute necessity, but in Microsoft's case dropping to below $249 this early on shows that they're lacking confidence. How do you guys see it?

meepmoopmeep3235d ago (Edited 3235d ago )

Chris Lewis seems to have a lot to say today. Must be a slow day at the office.

It will be interesting to see if the price cut will have a great impact or not. I mean, the 360 has always been cheaper than the PS3 from day one.

eagle213235d ago

I really want to know how many on xbox live don't pay. Sony is like 7 million (in 1.2 years) PSN and Live with this 10 million (since 2001). I want to know this information because with the install base much higher (he confirms 17.7 million) than the service, how many actually want Live? Or have households that have a network? Or are willing to pay for it? Or simply not interested? Or bought more than one 360? :)

meepmoopmeep3235d ago

MS never gives you real numbers and the ones they do give are sugar coated with PR crap

DJ3235d ago

And 80~85% of the accounts are composed of Xbox 360 owners. It used to be smaller, but the demographics changed over the past two years. What this means of course is that PSN actually has more users Capable of online gameplay than than Xbox Live, which is definitely a frightening figure for Microsoft. Of course, it's important to understand that not everyone using PSN is using it for online gameplay. As with the Live service, some are just using it for downloadable content or messaging.

Microsoft recently implemented a 'punishment system' on Live, which basically excludes Silver members from getting content until about a week after Gold members are able to purchase/download said content. I'm a Psych major, and I can tell you first and foremost that consumer punishment Does Not Work. I'm sure they'll keep implementing "incentives" to convert Silver Members into Gold Members though, but really this is just desperate and clingy behavior. Now, this would actually be highly successful if Xbox Live was the only competent service this generation. Unfortunately, a great (and free) alternative exists: Playstation Network.

When Xbox Live suffered horrendous shutdowns and technical setbacks this holiday season, PSN subscriptions shot through the roof. That alone is glaring proof that Microsoft needs to eliminate their subcription fee and treat EVERYONE as a Gold Member. Sony already does this, which is why PSN is so successful. It's a competition between two very different philosophies, and it'll be interesting to see which one ends up prevailing in a few years.

Microsoft's strategy is to entice customers with Arcade SKUs and free Silver Subscriptions, and then gradually ratchet them up into Elite SKUs and paid Gold Subscriptions. They've created a brand that's reliant on status; the Elite 360 didn't get that name by accident. This strategy is also evident in their OS products.

Sony doesn't like to implement such Status tiers in their products, which is why the PS3 (despite having multiple SKUs for some dumb reason) has such neutral names, i.e. 40GB, 60GB, 80GB.

eagle213235d ago

60% is solid, but the growth of the service is stalling a bit..and Home is coming so soon...lol

7h3ultim8p003235d ago

Where are those NPD numbers? It's March 13 and past 12 noon

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