Question: What is the mass-market price, and when will Xbox 360 achieve that?
Answer: : If you look back in history — again, it’s not just going to follow what’s in history — in some cases, 75% to 80% of the business gets done $199 and below. So, we’re not quite there yet. I think that number can change over time because of inflation, greater capabilities; what we can do what Xbox 360, even the core system, is far beyond what you could do before in previous generations. Who knows? Maybe $249 will be a mass-market price point — but historically, $199 has been when you’re talking a PlayStation 2-like install base. 80% of the business gets done at $199 and below. We’re like the other guys, right?
We’re trying to drive costs out of the system as much as possible so we can hit those price points. We’re a little closer than Sony is with PlayStation 3, thankfully, but we’re all trying to get that magic price point.
Question: Are you going to move toward that in 2007?
Answer: Stay tuned. We didn’t announce anything here, didn’t feel the need to. July is a very odd time to announce a price reduction. I’m not even sure Sony announced a price reduction, anyway [Kim is pointing to the fact that the PS3 launched with a $499 20GB version and a $599 60GB model; Sony discontinued the $499 20GB version in April 2007 in North America, so the company is essentially reducing the 60GB model to the 20GB price. –Ed.], but we don’t feel the need to do it here at E3.