For the past two years, Microsoft has established a reputation as a follower in the video game war. When Sony acted, Microsoft reacted – especially when it came to price cuts. Things could be about to change.
Microsoft"s Xbox may be on the verge of a substantial price cut, falling from $179 to $99 by Labor Day, according to P.J. McNealy, an analyst with American Technology Research. "It is our belief that the price on the consoles in North America could see a stepped drop this year, with both the PS2 and Xbox being cut to $129 between now and the May E3 trade show, with [Microsoft] then cutting the Xbox further to $99 in the late summer," he wrote in a research note released Wednesday. McNealy also believes Microsoft will launch its next generation console in late 2005 – a year earlier than has been previously rumored. That would put the Xbox 2 on store shelves up to a full year before Sony"s PlayStation 3.