Xbox Sees Price Drop - Kind Of...

After weeks of rumors and leaked retailer’s pamphlets, Microsoft finally came clean about the price drop of their standard Xbox360 model. Yes, the 20gb hard drive equipped Pro edition is dropping in price by $50 in the US and Canada, to $299. However, as few of the rumors uncovered, it is merely a clearance price. The model will be replaced August 4, 2008 with a 60gb model, now called “Standard” according to the press release, still priced at $349.

The increased space is a welcome addition as more downloadable expansion content for retail games joins an increased number of premium games on the Xbox LIVE online service. Video content, both tv and movies, takes up a large amount of space as well. A couple of new questions are raised by this move, though.

Even at a temporary rate, the $299 model with a hard drive is sure to cannibalize sales of the $279 hard drive-free Arcade model. With a 60gb drive, the disparity between the new Standard and the Arcade becomes greater, decreasing the “value” part of Microsoft’s “value” edition of their console.

Critics and fans alike have maligned the Sony PlayStation3’s required installs of several popular games, including Grand Theft Auto 4 and Metal Gear Solid 4 (along with other games that aren’t the 4th in a series). With a 60gb “standard” now in the 360’s line up, the possibility of designers taking advantage of the extra storage space is high. Reduced load times in exchange for reduced storage and a 5-10 minute wait before fans can play their new game is an attractive trade-off for developers, but hasn’t been very well received by the gaming community thus far.

Additionally, no price has been announced as yet for the 60gb hard drive on its own. At $99, the 20gb hard drive (while it does include easy install and proprietary technology) sits at about 5 times the going price for a 20gb hard drive made for a PC. At press time, 750gb SATA PC hard drives, that’s 37 times the storage space, can be found for the same $99 price tag. The larger 120gb hard drive still retails for $179, as well, indicating that we may not see a price drop in the standalone drives.

Some of these questions may be answered throughout the week at the E3 convention. Microsoft’s keynote is not likely to publicize things like mandatory installs, but some of the individual game developers/publishers may. Regardless, the clearance sale should renew waning sales in the U.S., and the offer of three times the storage for the same previous price is certainly a welcome change.