14 DAY TRIAL // This week, Microsoft announced that it was slashing the price of the newly launched Xbox One home console to 399 British pounds in the United Kingdom on a permanent basis starting February 28 of this year.
The company says that it is implementing the measure in order to give all gamers who are interested in buying the new gaming platform access to more value for their money and the executive announcing the measure, Harvey Eagle, certainly believes that it will have a long-term impact on its sales.
Apparently, Microsoft does not plan to implement a similar price cut for other markets, which means that the Xbox One will remain priced at 499 dollars and Euro in the United States and in Europe.
The measure comes just ahead of the launch of Titanfall, the first-person shooter from developer Respawn Entertainment and publisher Electronic Arts, which is widely expected to generate bigger sales of the Xbox One when it arrives on March 11 in the US and two days later in the UK and the rest of the EU.
Traditionally, price cuts are seen as a positive measure for gamers, who are able to get access to a new hardware for a lower price and to some new titles, but Microsoft’s move might be considered as being profoundly disrespectful for early adopters, those who were willing to pay on launch in order to get access to an Xbox One.
Companies have usually waited for at least one year before cutting the price of their hardware and have only done so after they have created a solid install base and when the community signaled that it was unwilling to tolerate the current price point in the long term.
Sony and Microsoft have also previously used a drop in manufacturing costs as a good reason to cut 50 or 100 dollars or Euro from the price of their consoles.
Nintendo has a long-term policy of keeping prices steady for as long as possible in order to make sure that none of its customers feels disappointed.
But Microsoft has moved quickly to drop the Xbox One cost to 399 British pounds in the United Kingdoms and certainly those who have bought a device on launch or in time for Christmas have good reason to be disappointed and annoyed.
After all, they are the ones who are dedicated to the company and have faith that its hardware can deliver a better experience than those coming from its rivals.
They are the ones who brag about their purchase, defend it on forums and in the public space and persuade others to spend their money.
Starting on February 28, they might be the ones that are disappointed and bitter, unwilling to give more of their faith to Microsoft after the perceived betrayal of the price cut.
And an angry fan base can pose a big problem for any company, especially one that’s locked in a long-term commercial battle against Sony and the PlayStation 4.
Microsoft should at least try to offer something in return to those who picked up the Xbox One early.
Suggestions coming from the community include things like: free Xbox Live Gold membership for six months or even one year, allowing them to experience and talk about the multiplayer and the entertainment side of the console; free access to some portion of the game library; a coupon that can be redeemed for future releases or a special set of badges to identify them online.
Nintendo did something similar and most of its fans were satisfied with the rewards that they received and the attitude of the company.
If Microsoft remains passive and does not reward early adopters of the Xbox One, it might need to launch a bigger damage control effort later in the year and might lose precious trust with the general public.
Sony does not need to actually react right now because it holds the sales lead, but it might profit from the problems of its rival and launch its own early adopter rewards program just to attract more sales for the PlayStation 4.
The United Kingdom might prove to be just a test case for a wider price drop and might represent a huge opportunity for the Xbox One to turn its fortunes around or begin a long slide towards second place in the next-gen console race.