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Brier Dudley offers a critical look at technology and business issues affecting the Northwest.

January 15, 2015 at 4:12 PM

Microsoft cuts Xbox One price again as industry posts flat 2014

To keep Xbox One sales momentum rolling beyond the holidays, Microsoft today announced that it’s dropping the console’s price back to $349.

Microsoft screenshot from "Killer Instinct: Season 2" for Xbox One.

Microsoft screenshot from “Killer Instinct: Season 2” for Xbox One.

That’s what the Xbox One sold for with holiday promotions that helped the console finally outsell Sony’s PlayStation 4 over the past two months, at least in the U.S. The price jumped back to $400 after New Year’s and now it’s back to $349 starting Friday.

(For those who just bought a console for $400, a Microsoft spokeswoman offered this advice: “Please follow up with your retailer where you purchased your console to check on their price adjustment policies.”)

Microsoft characterized today’s price drop as a “promotion,” suggesting that it’s temporary.  The spokeswoman declined to say if the price will go back up again. Bundles with the Kinect sensor remain $499.

In its release, Microsoft called 2014 a “fantastic” year and said its Xbox One platform had the most game sales in November and December.

Microsoft dropped its news just ahead of a report from NPD on U.S. game sales during 2014. The report showed an industry in transition, with hardware sales up 20 percent during the year but software sales down a striking 14 percent.

The report counts only games sold in physical formats at retail and not downloads. NPD attributed the drop to game players increasingly buying games via download. It also noted that 10 percent fewer titles were released last year than in 2013.

Overall U.S. retail sales of game hardware, software and accessories grew just 1 percent last year, to $13.1 billion, the firm said. That included $5.07 billion worth of game hardware sales and $5.47 billion worth of game software sold for consoles, handhelds and PCs.

Accessory sales were a bright spot — up 5 percent — driven by figurines such as Nintendo’s amiibo and those sold for Activison’s “Skylanders” games and Disney’s “Infinity” games.

Game sales ended the year with a thud, posting a 1 percent decline in December. Hardware sales were down 4 percent during the month and software sales were down 2 percent. Apparently people bought figurines and extra controllers as stocking stuffers — accessory sales were up 8 percent in the month.

The stats don’t reflect the success of the latest generation of consoles, which aren’t broken out in the summary.

Sales of “eighth-generation” consoles including the Xbox One, PS4 and Nintendo’s Wii U were up 13 percent last month. NPD analyst Liam Callahan said that’s “remarkable” since it’s growth over and above their record-breaking launches a year ago.

Software for the new consoles grew 70 percent during December and through the year, current-generation software sales at retail rose by $1.7 billion, Callahan said.

Nintendo also weighed in, issuing a release that said Wii U console sales grew more than 29 percent and Wii U game sales grew more than 75 percent last month. Through the year, its “Mario Kart 8” sold 1.7 million copies and “Super Smash Bros. for Wii U” sold 1.3 million copies. (Seattle Times readers knew a Nintendo turnaround was likely …).

“Wii U had its strongest year yet thanks to the highly anticipated software lineup and the introduction of the amiibo platform,” Nintendo of America’s executive vice president of sales and marketing, Scott Moffitt, said in a release.

Here are the top 10 games sold in 2014:

Call of Duty: Advanced Warfare (360, XBO, PS4, PS3, PC)
Madden NFL 15 (360, PS4, XBO, PS3)
Destiny (XBO, PS4, 360, PS3)
Grand Theft Auto V (PS4, XBO, 360, PS3)
Minecraft (360, PS3, XBO, PS4)
Super Smash Bros.(3DS, NWU)
NBA 2K15 (PS4, XBO, 360, PS3, PC)
Watch Dogs (PS4, XBO, 360, PS3, PC, NWU)
FIFA 15 (360, PS4, XBO, PS3, Wii, 3DS, PSV)
Call Of Duty: Ghosts (360, PS3, XBO, PS4, NWU, PC)



Comments | Topics: Microsoft, Nintendo, price cut


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