Microsoft has temporarily cut the price of the Xbox One by $50, the company announced on Monday.
The reduction lowers the console’s price to $349 and is effective between November 2 and January 3. The various Xbox One bundles for Sunset Overdrive, Assassin’s Creed Unity, and Call of Duty: Advanced Warfare will all receive the $50 price cut as well.
The move gives the Xbox One a holiday season pricing edge against Sony’s rival PS4, which at the moment costs $399. Sony’s system has outsold Microsoft’s since the beginning of this console generation, in part because the Xbox One came out of the gate $100 higher than the PS4.
In less than a year, however, Microsoft has reduced the price by $150, and while the latest cut is a temporary one, it comes at a critical time. Both systems are a bit lacking in the sort of big, must-have exclusive games that tend to drive holiday sales (those come next year with the release of Halo 5 and a new Uncharted). As a result, price will likely play a significant role in influencing fence-sitters.
The price cut could also spur sales of third-party games for the Xbox One, which are down from a year ago. In the last fiscal quarter, Microsoft sold 2.4 million Xbox consoles, but because the company does not break out sales by system, it’s impossible to conclusively determine how many of those were Xbox Ones. Analysts contend the Xbox 360 has remained a strong seller.
With Monday’s move, the Xbox One is just $100 more than an Xbox 360, which could tip the scale. Microsoft has not given sales data for the Xbox One since April, when the number hit 5 million. Sony, meanwhile, announced the PS4 had topped sales of 10 million in August.
The price cut might be viewed as a desperate move by Microsoft, but it’s worth noting that the system is actually doing quite well compared to its predecessor. Edward Williams of BMO Capital Markets, quoting NPD data, says the PS4 and Xbox One have sold 4.5 million and 3.5 million units, respectively, to U.S. consumers since their launch.
As of this month, the combined sales of the PS4 and Xbox One are roughly 76 percent higher than the combined sales of the PS3 and 360 through their first 11 months on store shelves.