« Ding, Dong, TIPS is Dead | Main | WIC 2002 »

Xbox Sales Gains

The Wall Street Journal is reporting that Xbox sales rose dramatically after Microsoft cut the price to $199:

Xbox sales jumped 131% in the two months after the software giant slashed the price $100 in May, according to NPD (www.npd.com). Although all three major game-console manufacturers announced price cuts in May, Xbox had the largest percentage gains in sales.

Microsoft, Redmond, Wash., has also fared well on the software front. According to NPD, Xbox sold more than 10 million units of software world-wide in the first eight months the console was on the market in the U.S., which is the most software ever sold for a new videogame system in the U.S. in that period of time. The Xbox videogames "Project Gotham Racing" by Microsoft Games Studios and "Dead or Alive 3" from Tecmo both hit the one-million mark in world-wide sales.

In an earlier story, the Journal reported on the Xbox-derived Freon:

What Freon stands for is a souped-up successor to the Xbox console -- capable of playing games but also offering television capabilities, such as pausing live TV and recording shows onto a computer hard drive, say people familiar with the effort. Though it is unclear whether such a product will ever be built, its core concept appears to have the backing of Microsoft Chairman Bill Gates, who wrote in an internal memorandum in January that he was a "big fan" of a machine that would combine video services with gaming.
I see arguments both for and against Freon. On the one hand, it could damage the Xbox's growing reputation as a great pure gaming console to begin building versions that try to do other things. Also, Microsoft would have to be extremely careful to ensure that no matter what else a Freon device was doing at any given time, gaming performance would remain identical to that on a stock Xbox. On the other hand, I can imagine some very cool entertainment experiences that one could build on an Xbox-type platform with both TiVo-like functionality and full matte and alpha blending capabilities.

Leaving Freon aside, Microsoft is legendary for taking three major versions to get a product right. Knowing, though, that there's no such thing as 2.0 (or even 1.1) of a video game machine, Microsoft got it right on the first try. In conversations with friends in the video game industry, the feeling is that Microsoft did so by listening to developers and building the product they asked for. It's not a revolutionary concept, but it works.

Post a comment