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GameStop CEO Wants Price Drops

| 16 Apr 2009 18:42
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Dan DeMatteo, the CEO of GameStop, wants to see price cuts from the PS3 and the Wii.

"That price point is clearly an issue in this economy," DeMatteo said about the PS3's asking price in an interview with CNBC. According to DeMatteo, Sony needs to drop the price of the PS3 to maintain growth. Sony can talk all they want about how they're not going to do it any time soon, but they need to, DeMatteo thinks, and when they do it, they need to do it big and drop it by $100.

"I don't know that $50 gets you that much," DeMatteo said.

Sony did drop the price of one of its products recently: the PS2. But DeMatteo doesn't really think this made much of a difference. "To be honest, it really wasn't worth doing," he remarked. "If they'd done it earlier, publishers probably would have kept making games for the PS2, but once they've stopped, they've stopped."

He also expressed a desire for Nintendo to drop the price on the seemingly ever popular Wii, stating that he thinks the console's sales could very well wane within the year. "I think [demand for] the Wii could slow down to the extent that Nintendo may want to cut the price," he said.

And, seemingly confirming speculation that Nintendo has chopped its production costs for the Wii drastically, DeMatteo said that it's totally within Nintendo's power to do a price cut. "Nintendo has it within its arsenal to do that. The component costs have come down considerably," he said. "They used to break even on the Wii, but now they're making a considerable margin."

If they're making "considerable" bank now, why would they want to stop? That honeymoon's far from over, Nintendo probably thinks.

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