Analysts claim that price cuts for both Microsoft's XBox and Sony's Playstation 2 are to be announced in the annual Electronic Entertainment Expo(E3). The main reason for the cuts is that the summer is traditionally considered to be the weakest season for console sales and producers will be looking to make their products more attractive.
According to the same analysts, Microsoft is expected to begin the price cuts by announcing a dramatic drop in the XBox's price to US$199 from US$299 at a news conference scheduled for May 20. If this does happen it is extremely likely that Sony will follow suit announcing an identical price cut for the PS2.
Microsoft are likely to begin the cuts since after selling 1.5 million units in the last six weeks of 2001, they went on to sell between 300,000 and 400,000 units in the first quarter of this year. This drop in sales figures and the lack of exclusive titles, will almost certainly lead to price cuts.
Things are not that certain as far as Sony are concerned. It would seem likely that the PS2 would not want to be considered the most expensive console in the market but demand seems to be strong and Sony are facing problems with other business ventures.
It all comes down to whether Sony will consider the threat of a lower priced XBox enough to cut their price. If they do not do so by E3 they will almost certainly announce a cut in September 2002.
As far as Nintendo are concerned, there seems to be a consensus, among analysts, that a price cut reducing the price of the GameCube from US$199 TO $149 will come in September 2002.
