Nov 10, 2005

Xbox 360: A Lesson In Consumerism

The second incarnation of Microsoft's video game console, the Xbox 360, will be released on November 22. There are two versions of the console being released: the Xbox 360 Core System, priced at $299.99, and the Xbox 360, priced at $399.99. The main difference between the systems is that the "standard" Xbox 360 comes with a hard drive, wireless controller and, for a limited time, a media remote.

The "Core System" seems to be aimed at parents who balk at spending $400 on a console, leaving their children to pony up $40 for a memory unit or $100 for a hard drive. It appears that if you want to play games from the original Xbox, you'll need the hard drive. A wireless controller is $50, and the media remote is another $30.

There will only be an extremely limited number of Xbox 360s available for the holidays, and many retailers are only selling the 360 as part of a rather expensive bundle pack that includes games and an extra controller. The ToysRUs bundle available through Amazon is $999.95 (not a typo). EB Games has a Core bundle for $599.93 and a standard bundle for $699.92. Their website states that orders placed now may not ship until 2006.

So what does all of this mean for the consumer? For starters, if they bought the Core System, most gamers would end up spending $100 to buy accessories already included in the standard system - so in this case, the more expensive system is probably the better deal.

What if you want the system the day it comes out? Limited quantities mean it's a seller's market, and that you have to pay a bundle just to get a system (pun intended). If you're a gamer who would have bought everything in the bundle anyway, then you'll probably save money. But I think that given a choice, there are at least a few things in every bundle pack that most gamers wouldn't buy (usually games). So most gamers will end up paying a premium for the privilege of getting their hands on the Xbox 360 when it first comes out, rather than waiting until supply meets demand.

I can understand that sometimes, you just have to have something. But I hope that the people who are buying the bundle packs have made a conscious decision to pay that premium, and that they've also decided that they can afford it (i.e., that they're not paying for it with a credit card they don't then pay off).


ChiefFamilyOfficer said...

This Penny Arcade strip contains a bit of profanity but is definitely in keeping with this post.

ChiefFamilyOfficer said...

That's a good point, although I'm not sure I want to encourage anyone to spend irresponsibly ;)