AUG. 22, 2012 • North and Latin America, plus the Asia Pacific markets saw the Microsoft Entertainment & Devices division shear $40 off the price of the Xbox Kinect motion sensor bundled with Kinect Sports. The new pricing will spread to Australia and New Zealand on Oct. 4. There are no plans for a similar drop in list price in Japan, Europe or the Middle East. Also arriving in October is the $80 The Essentials Pack bundle, which features a wireless Xbox 360 controller, an HDMI cable, a Media Remote, and a three-month subscription to Xbox Live Gold. The bundle is a $55 saving on purchasing those items separately.
Impact: Console unit sales continue to decline in North America, yet the Xbox 360 has remained the top seller during the 19 months leading into July. That stretch of success directly parallels with the November 2010 introduction of the Kinect motion sensor/controller. The dance and exercise titles that popularized the Kinect did, in fact, reach out to a wider user demographic that has provided Microsoft with a robust “second half” in this current console cycle. The decision to reduce the price on the Kinect is an interesting one when we note that Europe and Japan were not included. We suspect most people buying a new Xbox 360 will likely purchase a bundle that includes the Kinect. How many Xbox 360 owners who want a Kinect but have not yet purchased one are out there? Even core gamers who are replacing a worn out unit likely already have a Kinect. So we wonder whom Microsoft hopes to attract with this $40 reduction. It may be simply a case of wanting to move some excess inventory. One market may be owners purchasing a used system that does not already have a Kinect accompanying it. Of course, these secondary market consumers are likely very cost conscious, so $99 or under would have made much more sense than $110 in that scenario.  What remains amazing is that Microsoft is only now having to drop the price on the Kinect.
