You have to look at the economics. You have to ask the question, over the life cycle, who has the cost advantage? Who can price most effectively? Who can reach the price points quicker? That has a huge impact on what gets driven. Because we were out there first, we have a bigger installed base of consoles. We can drive down the manufacturing curve sooner and faster. And because we designed a box that was fundamentally easier to manage on costs, we’re going to have that advantage.
– Microsoft President of Entertainment Robbie Bach
Since the Xbox 360 has been out for a year now, it’s no surprise that Microsoft’s console is currently the leading next gen console, which means it’s about time for the retail price of the console to lower. There are already many places that offer rebates and cheaper bundles for the console, but you can’t walk into a Best Buy or Circuit City and get an Xbox 360 premium console for under $399. Microsoft is now focusing on reducing the manufacturing price of the Xbox 360, but there’s really no promise on when we can actually see a price drop. I was hoping Microsoft would have it done by Christmas this year, as the 360 would make an awesome present for someone who wants to get into next gen gaming, and a price tag closer to the Wii’s $250 would certainly give it an extra push.