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Possible Natal Pricing Strategy by Microsoft

by William Schwartz on June 12, 2010

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Alot of the talk in the recent weeks about Microsoft’s still codenamed Project Natal is that it will be priced high.  So high that most people that have been following the developments of the motion control wars over the past six months or so, think that this peripheral will fail at such a high price point.  But with the talks of an Xbox 360 slim in the works, and a Project Natal bundle all but imminent if the slim is announced, is it all that hard to imagine Microsoft pricing the Natal at a point which makes gamers ponder whether purchasing the unit standalone is worth it? Why not take the opportunity to up sell the consumer to a redesigned Xbox 360, an expanded HDD, and a motion controller.   It’s not that hard to imagine and here’s why.

As Microsoft has considerably lowered their costs to produce Xbox 360 units, adding Natal in a bundle has positive effects in a couple of different ways.  Number one, it gets more units out there.  It’s inevitable, this holiday season Microsoft will sell the bulk of its units.  And if a consumer can get a motion controller alongside the console while staying at a price that is seemingly fair, it is viewed as such and increases the incentive to purchase.  Second, not only will it get more Natal units out there, it will increase the console sales for the year and lay down a solid base of Slim units.  If the price of the Natal unit is indeed priced at the high end of the speculated range, it will sitting right next to a bundle that could be considered comparatively cheap. Other problems that a Natal bundle could solve, piracy for one.  If Natal increases the demand for Xbox 360’s Microsoft could take the initiative to include an unflashable DVD drive in the new system thereby thwarting piracy in late 2010 and possibly some of 2011, or until the eventual hacking of the new tech.

In addition, Microsoft will do it’s annual purge of T.O.S. violators from Xbox Live, crippling many units.  Last year, the number was rumored to be near a million.  With most of these users turning around and buying a new system, this could be another opportunity to get a great number of Natal units into homes.  Hand in hand, an Xbox 360 Slim and Natal partnership could increase the awareness of each other while enhancing Microsoft’s bottom line.

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