In a note to investors, Pachtor estimated that the bill of materials for the Xbox One runs at around $325, while the PlayStation 4 runs at about $275, hence their retail price points.
In the case of Microsoft, however, Pachtor notes that the option of an available subsidized price may be possible through a multi-year subscription from a broadcast, cable or ISP provider.
“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 subsidised box in exchange for a multi-year contract,” he says. “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.
“In addition, Microsoft could conceivably subsidise the Xbox One through prepaid Xbox Live Gold subscriptions (as it has done on a limited basis in the past) or premium Skype functionality as well. Similarly, Sony could subsidise the PS4 through prepaid PlayStation Network subscriptions, but unlike Microsoft, it does not have a history of doing so.”
Wedbush Morgan also expects a round of price cuts for the current-generation Xbox 360 and PlayStation 3, something that was already mentioned to be a part of Microsoft’s plan for the Xbox 360. They expect around another $50 off each consoles by the time next-gen platforms roll around.
What do you guys think? Do those sound like reasonable prices for the Xbox One and PlayStation 4? Sound off below!