A $99 Xbox bundle: Microsoft's key to market domination?
The console will reportedly be bundled with Kinect for a price that seems too good to be true. Perhaps it is.
Is this deal as good as it sounds?
It's a brilliant strategy: The gutted upfront price will convince potential consumers "who may have been put off by the Xbox 360's current costs to splurge," say Mangalindan. The truth is, $99 is such a small "psychological threshold to cross" that it's unfathomable that Microsoft won't see a major sales spike, cementing the system's status as the number one gaming console. Plus, customers are locked into the Xbox experience for two years because of the subscription contract, so Microsoft doesn't have to worry about gamers abandoning them.
But it's a bad deal for customers: Today, you can buy this bundle for around $300, says Jason Cross at Tech Hive, and the cheapest Xbox Live Gold subscription is $120 for two years. That's $420 total. This rumored new bundle, even with the astoundingly low $99 upfront cost, would actually be more expensive over time, totaling $460 after two years of $15-a-month fees are tallied up. Customers will probably still buy into this new bundle — but it's hardly a bargain.
Regardless, it could transform the living room: This isn't just a big deal for gamers, says Drew Bergmark at Platform Nation. It could also woo movie and TV lovers "looking to combat the traditional markets of cable and satellite providers." The web-connected Xbox gives you online access to services like Netflix (NFLX) and Hulu, and if you pony up for their subscription fees, you'd have access to a trove of movies and TV series through your Xbox for just $50 or so each month — far less than the average $95 it costs for cable in a big city. If HBO Go and YouTube get on board, this "could mean a revolution in the living room."
More from The Week
- Draw Something's disastrous month: 3 theories behind the slump
- Nintendo's worst year ever
- Storify for iPad: The perfect match?
HBO GO and YouTube (as well as a bunch of other content providers) are already on board.
Copyright © 2014 Microsoft. All rights reserved.
Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.
Start investing in technology companies with help from financial writers and experts who know the industry best. Learn what to look for in a technology company to make the right investment decisions.
With Google Glass on sale to the general public today, it's time to have a serious and overdue discussion about technology and privacy.
VIDEO ON MSN MONEY
MUST-SEE ON MSN
- Video: Easy DIY smoked meats at home
A charcuterie master shares his process for cold-smoking meat at home.
- Jetpacks about to go mainstream
- Weird things covered by home insurance
- Bing: 70 percent of adults report 'digital eye strain'