Microsoft believes recent price cuts to its Xbox 360 games console will help it to attract more casual gamers to its platform.
Price cut: Xbox 360 is now cheaper than ever
The price cut means that the entry-level games machine, the Xbox 360 Arcade, now costs less than the Nintendo Wii.
"History shows that £159 is the price point where a console's audience begins to expand," said Chris Lewis, vice president of Microsoft's interactive entertainment division in Europe. "It does now give us much broader appeal. We do have much more mass market content, with more casual titles. This opens up that space even more broadly."
The price reductions, which come into effect from Friday, will see the Arcade drop from £199.99 to £159.99, while the Xbox 360 Premium, which has a 20GB hard drive, will cost £199.99 instead of £249.99, and the Xbox 360 Elite with 120GB hard drive, will retail for £259.99 rather than £299.99.
Microsoft also defended its decision to back the HD-DVD next-generation DVD format. HD-DVD recently lost out to Blu-ray in the format war, and Microsoft was forced to announce that it would no longer be producing a bolt-on HD-DVD player for the Xbox 360.
advertisement"At the time, our view was that the right roll of the dice for us was around HD-DVD," says Lewis. "But we wanted to give our consumers a choice. We didnt want to force anyone down a particular route as regards DVD playback.
"From the outset we said that the 360 is at its heart an online, broad-appeal gaming platform. My view now is that the future is very much around the role of digital downloads," he added.
Microsoft already offers some film and TV downloads through its online marketplace. Although hugely popular in the US and UK, the Xbox 360 has been outsold in Japan by Sony's PlayStation 3, and still lags behind global sales of the Nintendo Wii, according to the industry website VG Chartz. Microsoft has sold about 18m Xbox 360 consoles worldwide since its launch in 2005.
"Europe is undoubtedly our critical geography in our worldwide aspiration to be market leaders," said Lewis.
"We're enjoying fantastic success in North America, we're having a great time in Europe, but we aspire to do even more." He re-iterated Microsoft's commitment to the platform, quashing suggestions that the price drop on the Xbox 360 was a tactic to clear the way for a new games console.
He also declined to comment on persistent rumours that Microsoft could be working on a handheld games console to rival Sony's PlayStation Portable, and Nintendo's wildly popular DS. "For now, we've got nothing to announce or respond to regarding any speculation about what we're doing in the handheld space," said Lewis.
The Xbox 360 price cuts come just weeks before the release of Grand Theft Auto IV, the much-anticipated latest installment in the Grand Theft Auto computer game series. The game will be released simultaneously on both Sony's PlayStation 3 and Microsoft's Xbox 360 platforms, and will pit the two technology giants against each other in a head-to-head battle to entice gamers to their platform.
By Claudine Beaumont
Last Updated: 12:01am GMT 11/03/2008
