This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Game For a Price War?

"I think we can sell a lot at a higher price point," says Brian Farrell, CEO of THQ (THQI), which plans to launch two Xbox 360 titles in coming months. "It's consistent with what we've seen in general in the past."

But Microsoft isn't taking that route. Although the company is charging $60 for a special edition of its Perfect Dark Zero game, it is charging $50 for the regular edition of the title and for its other two launch titles, Project Gotham Racing and Kameo: Elements of Power.

Microsoft wanted to reassure consumers that they'd be able to get top-of-the-line titles for the next generation at the same price they have paid for current generation games, says David Reid, the company's director of platform marketing for the Xbox.

"Our perspective on this is clear," Reid says. "We believe we can have a good business model in parity with what we have today (on pricing)."

Microsoft's decision could weigh heavily on the ability of the third-party publishers to maintain their price hikes on next generation titles. According to IGN, which runs a series of Web sites catering to gamers, Microsoft's Perfect Dark Zero was the most anticipated title for the Xbox 360, and all three of its games ranked in the top seven.

There have been past examples of publishers pricing their titles higher than those from the game-system makers, at launch, says Joe Spiegel, a hedge fund manager at Dalek Capital.

Typically, that strategy of pricing games higher than those of the system manufacturer "didn't end well for the third-party guys," says Spiegel, who is long Take-Two (TTWO - Get Report), Nintendo and, through put options, is effectively short Activision.

But others believe the move may pay off -- at least in the short term. IGN's survey aside, the titles that are commanding the premium prices on the Xbox 360 are likely to be games such as Activision's Call of Duty 2 or EA's Need For Speed: Most Wanted, some analysts say.

2 of 3

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
SYM TRADE IT LAST %CHG
THQI $0.31 0.00%
ATVI $22.80 0.00%
MSFT $41.62 0.00%
SNE $30.01 0.00%
TTWO $24.72 0.00%

Markets

DOW 17,826.30 -279.47 -1.54%
S&P 500 2,081.18 -23.81 -1.13%
NASDAQ 4,931.8150 -75.9760 -1.52%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs