Microsoft announces prices for new Xbox 360

August 18, 2005

Microsoft has revealed prices for the Xbox 360, its new games console which goes on sale later this year. Details were made public by Chris Lewis, the Regional Vice President of Xbox across Europe, the Middle East and Africa, in an interview with the console's official website, Xbox.com.

According to Lewis, the Xbox 360 will ship in two separate bundles &mdash; the full system, and the Core System. The full system is the premium edition; it comes with the components and accessories &mdash; including a detachable 20-gigabyte hard drive and wireless controller &mdash; that Microsoft believes necessary for experiencing 'the ultimate digital entertainment thrill ride'. It will retail at $399.99 in the US, €399.99 in Europe and £279.99 in the UK. The Core System is essentially a stripped-down version, offering the full power of the Xbox 360 without the add-on features. This edition will retail at $299.99 in the US, €299.99 in Europe and £209.99 in the UK.

Rumours have been circulating about the price tag since the Xbox 360 was unveiled to a blaze of publicity at this year's E3. Yesterday's announcement confirmed early speculation by analysts at major investment bank UBS that Microsoft would sell its new console at a loss. The stand-alone Xbox 360 contains $375 worth of hardware. With the console set to retail at $299.99 (or $399.99 with $100 worth of add-ons) Microsoft stands to make a $76 loss on each unit sold. It is expected that 933,000 to 1.2 million units will be sold in 2005, which means that the Xbox 360 could cost its publisher up to $91.2 million for this year alone. Microsoft plans to make up the lost income with sales of its eagerly awaited launch titles.