Analyst predicts launch pricing for Playstation 4 and Xbox One

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Let's get this out on the table right off the bat. Today's post is based on a report from Wedbush Morgan analyst Michael Pachter. I feel like Pachter is the DigiTimes of analysts: completely wrong as often as he is right. So maybe it's wishful thinking that has me passing this news along, but I sure hope Pachter is right this time.

Because if Pachter is correct, the 'next gen' of videogame consoles is going to be relatively cheap.

Pachter says (PDF link), in an E3 Preview report, that he's estimated that the cost of materials for a Playstation 4 is $275, and the cost of the Xbox One is $325. Based on those numbers, he thinks the PS4 will launch at $349; a far cry from the $500 and up price of the PS3 at launch.

The Xbox One story (according to Pachter) is a little more complex. He thinks the Xbox One could launch at $399, but suggests there are multiple ways that cost could be subsidized, either through Microsoft (via an Xbox Live subscription), or through your cable provider or even premium Skype subscriptions. Assuming you don't want to go the subsidization route, $400 is the same price that the hard drive equipped Xbox 360 launched at (there was a Core system available for $299 that had no hard drive).

Pachter also suggests that we'll see price cuts for existing hardware between now and the holidays, with the PS3 and Xbox 360 dropping at least $50 and the Nintendo Wii dropping to $99. He suggests a price cut for the Playstation Vita is 'likely' and that the Wii U will get either a $50 price cut or some kind of bundle deal.

I'm pretty excited about these prices; I was expecting both systems to start higher than Pachter predicts so I hope he's correct. At $350 the PS4 would probably be a day 1 purchase for me. I'm still waiting for more details on the Xbox One before I make a decision there.

As an add bonus Pachter's report included this partial E3 schedule. I've tweaked it a bit to be of more use to those of us attending virtually. I'm not sure yet how much of this will be available for streaming. I know Spike TV is doing some coverage and both Microsoft and Sony normally stream their events.

Monday, June 10
9:00 am – Microsoft’s Xbox E3 2013 Media Briefing
1:00pm – The Download: EA's 2013 Press Conference
3:00pm – Ubisoft E3 2013 Media Briefing
6:00pm – Sony PlayStation E3 2013 Press Conference

Tuesday, June 11
7:30am – Ubisoft’s Analysts & Investors Meeting with Top Management
10:30am – Nintendo’s Business Partner Presentation @ E3
12:00pm – Exhibit Floor Opens
5:00pm – Wedbush / Intel 2013 Networking Event hosted by Michael Pachter

Wednesday, June 12
7:45am – EA’s Analyst Breakfast
9:30am – Nintendo E3 Analyst Briefing

Thursday, June 13
5:00pm – Exhibit floor closes

Less than a week to go! It should be the most exciting E3 we've seen for quite a few years with two major consoles showing off their gaming chops.

So assuming Pachter is right, how do you feel about these prices? $350 for PS4, $400 for Xbox One. Are you planning to be an early adopter of either one?

Read more of Peter Smith's TechnoFile blog and follow the latest IT news at ITworld. Follow Peter on Twitter at @pasmith. For the latest IT news, analysis and how-tos, follow ITworld on Twitter and Facebook.

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