GAMES: Microsoft remains "absolutely committed" to the video games market and has increased sales of its flagship Xbox console following recent price reductions in Europe, Mr Kevin Dillon, vice-president of Microsoft Europe, Middle East and Africa, has said.
Mr Dillon, who also manages Microsoft's European Operations Centre in Dublin - which has co-ordinated the distribution of the Xbox - also told The Irish Times that the Xbox was a long-term investment.
"We're still positive, we've had good feedback about the console and have obviously changed the price," said Mr Dillon. "We are absolutely committed to it."
He said Xbox sales were mixed, with some markets performing better than others. Price was an issue in some markets but in the last few weeks Microsoft had seen a "very significant upturn in sales", he said.
Mr Dillon's comments follow disappointing sales in the European market for the Xbox console in its first few weeks, prompting the firm to slash the price of its console by almost €200 to €299.
The company also pared its shipments to 3.5 million-4 million units by the end of June from a prior forecast of 4.5 million-6 million
In the US this week, Microsoft cut the price of its Xbox to $199 (€219) from $299.
The video games market has become brutally competitive, as powerhouses Nintendo, Sony and Microsoft all scramble for a share of the $20 billion-plus market.
In a separate announcement, Sony put more pressure on its lagging rivals by cutting prices on its top-selling PlayStation 2 and PSX consoles. PSX is the original playstation console, which preceded the much revamped and updated Playstation 2.
Sony said it would slash the price of its PlayStation 2 console in the US by one-third and halve the price of its original PSX in most markets around the world.
PlayStation (the PSX version) will sell for €89 in Europe and £49 sterling (€78.50) in Britain.
Earlier this week, the Japanese games company Nintendo said it had sold 400,000 GameCube consoles, or 80 per cent of its launch stock, in its first week in Europe.
The firm said it was delivering daily shipments to retailers, while another 500,000 units are expected to be shipped over the next seven weeks.
"It has been, without doubt, a very successful launch, and this is set to continue as we bring in more stock on a regular basis in the forthcoming weeks," said Mr Andy Williams, Nintendo UK general manager.
Nintendo also said consumers were buying an average of 2.3 games with each GameCube purchase.
In a surprise move, Nintendo cut the price of GameCube two weeks before its European launch by up to 24 per cent in an effort to stoke demand in what is considered the most competitive video-game console market in memory.
The strategy, which priced GameCube at about €100 cheaper than Sony's PlayStation 2, the global best-seller, and Microsoft's Xbox appears to be paying off.
The GameCube retails for €199 in Europe and £129 sterling in the United Kingdom.
"What's really significant here is that the initial shipment number was so huge," said Mr Stuart Dinsey, managing editor for games trade weekly MCV. "Nintendo quite clearly is saying we're going to look to catch up as quickly as we can to Sony and were looking to squeeze Xbox," he added. (Additional reporting Reuters)
