Originally Posted by DjiXas
I doubt they would ever sell Kinect with XBox, because of the price. Cheapest consoles sell.
True words. One of two primary reasons the PS3 took so long to really take off was the crazy high $600 price, which was directly attributable to the Blu-Ray drive. (The other reason was no killer-app games for what, over a year?)
My thought was that the price of the components would go down over time, as typically does. If they can incorporate the Kinect hardware into the product for a retail price increase of, say, maybe $50 more than a basic Xbox 3, then the value proposition goes up for the product differentation. The ideal price for a brand new console is probably still $400...but maybe $450 would not be a dealbreaker if the perceived improvement to the gaming experience is worth more than $50 extra dollars. But I think that once you start getting into the $100 premium range, you're better off releasing two SKUs, one with Kinect and one without. (And leaving standalone Kinect as-is, as a $150 upgrade option for the basic system.) Even though you are diluting your competitive advantage, there are just too many people that won't find Kinect worth a three-digit price premium.