The First Move Factor

During the latter part of last year, after the holiday season was nearing its close -- Xbox Live bogged down, disabling the normal day to day activities of X360 owners. The LIVE team quickly handled the issue, and with regular updates through their head honcho, strangely acting as their impromptu PR guy, to calm damn the millions of pissed off gamers -- it was later on resolved but with a few lawsuits here and there which were dismissed by the courts.

Enter January, pieces from various blogs and gaming sites began to spawn rumors and predictions for the year ahead. All had a consistent theme - Microsoft’s demise. Left and right, writers, analysts, and Sony fanboys alike strongly believed (and still believes) that this is the year of Sony’s Playstation 3 and X360’s downfall, majority proudly claimed the latter has peaked and sales will slow down drastically.

But stop right there. These predictions -- are merely predictions, educated guesses at best. True, NPD came out with Jan and Feb figures, Microsoft’s camp is trailing due to a supposed supply constraint -- which they proved later on by having to sign up a second manufacturer from China in able to curtail and chances of having hardware shortages in preparation for Grand Theft Auto 4’s release next month.

Xbox 360 isn’t dead simply due to two obvious factors:

First, It’s still got a powerful lineup versus Sony’s. No one can’t deny the immense power content has, Sony does have a more well seasoned release schedule for the year, however, Microsoft still has tons of possible ways to curb the momentum through the release of Gears of War 2 and some other first party exclusives. And with the help of Microsoft’s marketing arm, who’ve mastered the art of attracting consumers through mainstream media -- Halo 3’s monster marketing made them gods in this craft, their exclusives may well sell in the millions each.

Second, price. Microsoft recently cut their prices in Europe which saw a surge of nearly 40% in sales for the first weekend, and school holidays is right around the corner, plus GTA4 will be released in a less than a month. They have the opportunity to spur momentum that would run through the slow summer season and early third quarter of this year before the Holiday season goes into full gear.

Being much cheaper than PS3 for the X360 pro and Wii for the Arcade SKU, the system has truly gone mainstream(in Europe at least), this is the time for Microsoft to leverage its first year head start, and that is through price cuts and value deals that would surely attract consumers - the obvious luxury of being first in the market. Seriously, Sony right now, with its price and games are targeting to convince the same old hardcore market which Microsoft has dominated for the past two years and Microsoft is ready to move on to the casual market that would help them achieve significant increase in sales.

In fact, Microsoft hasn’t even given in to the idea of slashing the prices in the US market. Most probably they’ll do it a week or so prior to the release of GTA4, which would hurt Sony’s chances of securing that ‘momentum’ to which they so arrogantly proclaim.

Microsoft’s system is the most flexible amongst the current gen offerings. It can tap to numerous competencies to create the perfect mix to entice both the hardcore and casual market. The Console wars is all about the value each console manufacturer offers to consumers, and Microsoft has the upper hand.