Microsoft becomes competitive again with a $100 price reduction, doubling console sales for June.
After a rocky start, the gaming platform competition between Sony and Microsoft is finally getting interesting. Microsoft has been chasing Sony for the lead in the U.S. video-game console market since the introduction of the new generation of consoles last year. Sony’s latest platform, the Playstation 4, has led sales for a sixth straight month.
However, Microsoft announced yesterday that purchases of its Xbox One doubled in the month of June. Sales of U.S. video game hardware and software rose 24 percent in June. Shipments of new generation consoles outweighed a small decline in game sales revenue, despite six of the 10 top-selling titles in June that play on the new consoles.
To remain competitive, Microsoft introduced a lower-priced version of its Xbox One on Jun. 9. This new version reduced the price $100 to match up with the PS4. The removal of the Kinect motion sensing device makes this price drop possible. Microsoft also upgraded the platform software to remove a much despised always-on Internet requirement.
“Combined sales of Xbox One and PS4 are over 80 percent higher than the combined totals for Xbox 360 and PS3 –- an indication of the strength of the start of this new console generation,” NPD analyst Liam Callahan said in the statement.
The reduction in game sales was not a big concern as new titles have already been announced. The year-end holiday season will see a surge of big-budget titles, including: Activision Blizzard Inc.’s Call of Duty: Advanced Warfare and Destiny; Electronic Arts Inc. (EA:US)’s Battlefield Hardline; and Ubisoft’s Assassin’s Creed Unity and Far Cry 4.
In the Xbox division, the company will shut down an ambitious effort to create original television programming, just one month after the debut of its first show. In addition to gains made with its gaming console, Microsoft also announced the elimination of 18,000 jobs, including 12,500 from recently acquired Nokia. Chief Executive Officer Satya Nadella is heading up a new plan that will integrate that business and slim down the company.
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