E3 2020 would have been held next month but as cancelled due to the ongoing COVID-19 pandemic. Microsoft was expected to offer plenty of information about the upcoming Xbox Series X at the event. One of the key pieces of info is the price of the console. However, a report now suggests Microsoft is waiting for Sony to price the PS5 before it announces the cost of the Series X.
For Microsoft, the decision makes a lot of sense. When the Xbox One and PS4 launched together in 2013, Microsoft's console was $100 more than Sony's. At the time, the company bundled the ill-fated Kinect motion sensor with the Xbox One, which Microsoft said justified the additional cost.
Consumers disagreed and embraced the PS4, setting it on a path to vastly outsell the Xbox One through the generation. Looking ahead to the Xbox Series X, it seems Microsoft does not want to make the same pricing mistake.
In waiting for Sony to name its price, Microsoft is clearly looking to either undercut its rival or match the PS5's price. This idea has been put forward by former Microsoft executive Peter Moore and analyst Michael Pachter. Moore claims Microsoft will aim to undercut the PS5 by $100.
Pachter argues the same and suggests Microsoft's success in other areas of its business can help it take a hit on the Xbox Series X.
“From what I've seen, Sony's gonna have to charge $500 for the PS5 and Microsoft has a big balance sheet,” revealed analyst Michael Pachter, thanks VG24/7.
“If they wanna cut the price by $100 – just price below [PS5] and subsidise the first 10 million [units] – they will,” the analyst continued. “So, I think that they're waiting to have Sony blink first and then they'll reveal the price. Very likely $400.”
Speaking on a Geoff Keighley's podcast alongside Pachter, Moore agreed and said Microsoft will ride the loss.
“Michael's right; what both companies are going through right now is [asking] ‘how much can we afford to lose in the first 12 to 18 months?' ‘what is our attach rate of software to hardware?' ‘What are we willing to do in year one, two and three to hit 10 million [units]?'” Moore told the podcast.