Industry analyst Michael Pachter believes the Xbox One will launch at $399 while the PlayStation 4 will actually come out of the gate even cheaper.
Michael Pachter, everyone’s favorite outspoken videogame industry analyst, made his opinions regarding next-gen console pricing known to the world today by way of a pre-E3 note to investors in which he said he believes that the PlayStation 4 will debut in the U.S. at $349, while the Xbox One will carry a release price of $399. His figures are based on the material cost of the consoles, which he placed at $275 for the PS4 and $325 for the Xbox One.
Even if the Xbox does launch at a higher price, however, Pachter said it is more likely to be subsidized through contract subscriptions with ISPs or cable providers. “We believe the ability to watch live TV from a cable, telco, or satellite set-top box through Xbox One could entice an MSO to drive subscriptions through a subsidized box in exchange for a multi-year contract,” Pachter wrote. “The ‘always connected’ requirement for the Xbox One likely means that a broadband connection will be required, suggesting to us that ISPs may have an incentive to offer a subsidy as well.”
He also noted that Microsoft could directly offset the consumer cost of the Xbox One with Xbox Live Gold subscription agreements or premium Skype functionality; Sony could do the same thing with PlayStation Network subscriptions, he added, but unlike Microsoft, which has previously offered subsidized deals on the Xbox 360 with Xbox Live subscriptions, it has no history of doing so.
Pachter also predicted, not surprisingly, that the Xbox 360, PlayStation 3 and Wii will soon undergo another round of price cuts, and that if the Wii U doesn’t get it into gear soon it “could be relegated to a first-party-only platform.”