DZNUTZ
04-17-2002, 04:40 PM
THQ Urge Microsoft To Drop Xbox Price 4/17/2002, by Elizabeth
In the latest sign that sales of Microsoft Xbox video game console could be flagging, the chief executive of game publisher THQ on Tuesday urged price cuts for the console, in Europe if not elsewhere, to spur sales of the machine.
It was the first such public call for discounting from a key partner and came on the heels of warnings from financial analysts who have pointed to slowing production of the 5-month-old console as a sign that sales could be losing momentum.
On a conference call to discuss THQ's quarterly results, THQ Chief Executive Brian Farrell said the Xbox was struggling in Japan and continental Europe, because of content and pricing issues, and urged Microsoft to implement a price cut in Europe "sooner rather than later."
"I don't think we're alone in that" view that the European Xbox price of 479 euros ($422.81) is too high, Farrell said.
"All it takes is a price cut and Microsoft will improve dramatically in Europe," said Mike Wallace, an analyst at UBS Warburg who covers both Microsoft and the video game business.
Farrell also estimated that Microsoft had sold only 200,000 Xboxes in Japan since the console's launch there in late February. The console launched in Europe in mid-March.
"We believe Microsoft needs compelling Japanese Xbox content to succeed in that market," Farrell said.
THQ estimates that 400,000 Xbox units sold in the United States during the first quarter, for an installed base of 1.8 million to date, with a year-end expectation for the United States of 4.5 million to 5 million units.
However, he also made it clear he was not disappointed with the console's domestic debut.
"We're actually satisfied...I think Xbox has done very well in the U.S., based on its launch," he said.
But UBS Warburg's Wallace said that while a price cut for the Xbox in Europe may come as soon as the end of the month, a U.S. cut could be six months away.
"I don't think they'll do the U.S. until Sony does," he said.
XBOX365 Says
A price cut is NEEDED in Europe. $422 for Xbox in Europe is a JOKE. The machine is built in Europe so the price should not be significantly higher than US based gamers have to pay. As for Japan, Xbox will always be the 3rd choice machine over there, but so long as it has a good installed base there, and a strong US base we should do well!
In the latest sign that sales of Microsoft Xbox video game console could be flagging, the chief executive of game publisher THQ on Tuesday urged price cuts for the console, in Europe if not elsewhere, to spur sales of the machine.
It was the first such public call for discounting from a key partner and came on the heels of warnings from financial analysts who have pointed to slowing production of the 5-month-old console as a sign that sales could be losing momentum.
On a conference call to discuss THQ's quarterly results, THQ Chief Executive Brian Farrell said the Xbox was struggling in Japan and continental Europe, because of content and pricing issues, and urged Microsoft to implement a price cut in Europe "sooner rather than later."
"I don't think we're alone in that" view that the European Xbox price of 479 euros ($422.81) is too high, Farrell said.
"All it takes is a price cut and Microsoft will improve dramatically in Europe," said Mike Wallace, an analyst at UBS Warburg who covers both Microsoft and the video game business.
Farrell also estimated that Microsoft had sold only 200,000 Xboxes in Japan since the console's launch there in late February. The console launched in Europe in mid-March.
"We believe Microsoft needs compelling Japanese Xbox content to succeed in that market," Farrell said.
THQ estimates that 400,000 Xbox units sold in the United States during the first quarter, for an installed base of 1.8 million to date, with a year-end expectation for the United States of 4.5 million to 5 million units.
However, he also made it clear he was not disappointed with the console's domestic debut.
"We're actually satisfied...I think Xbox has done very well in the U.S., based on its launch," he said.
But UBS Warburg's Wallace said that while a price cut for the Xbox in Europe may come as soon as the end of the month, a U.S. cut could be six months away.
"I don't think they'll do the U.S. until Sony does," he said.
XBOX365 Says
A price cut is NEEDED in Europe. $422 for Xbox in Europe is a JOKE. The machine is built in Europe so the price should not be significantly higher than US based gamers have to pay. As for Japan, Xbox will always be the 3rd choice machine over there, but so long as it has a good installed base there, and a strong US base we should do well!