Nintendo Mum on Reason Behind DSi, DSi XL $20 Price Cuts
Nintendo of America wouldn’t say why it decided to cut the prices of its DSi by $20 to $149.99 and DSi XL to $169.99, effective Sept. 12. Microsoft, meanwhile, didn’t immediately respond to a request for comment on why it decided to increase the cost of its Xbox Live Gold subscription plans “for some members” as of Nov. 1. Wedbush Morgan Securities analyst Michael Pachter downplayed the significance of both pricing moves.
The DSi now costs $169.99, while the DSi XL with larger dual screens costs $189.99. NOA kept the price of its DS Lite system at $129.99, also without saying why. Cammie Dunaway, NOA executive vice president of sales and marketing, said, “Our new Nintendo DSi prices make it easier than ever for consumers to access the tremendous variety of games, applications and social tools on the Nintendo DSi and Nintendo DSi XL systems."
Game hardware manufacturers often lower the price of their systems in the late summer or fall, ahead of the holiday season. Handheld system sales have also slowed considerably in the U.S. in recent months, according to NPD (CED Aug 16 p6), a further possible incentive to cut pricing. Nintendo is also preparing to ship, by March 31, the 3DS handheld system that achieves stereoscopic 3D effects without the need for special glasses (CED March 24 p1). The company hasn’t said how much the 3DS will cost, but there’s been speculation that it could cost anywhere from under $200 to about $300. Sub-$200 pricing would allow Nintendo to reach a more mass audience, which its game systems tend to target. Moving the price of the DSi XL to $169.99 from $189.99 would apparently give NOA more flexibility on sub-$200 pricing for the 3DS.
The only surprise for Wedbush’s Pachter was he expected NOA “would cut the prices of all three” current DS systems “at the same time,” right before the 3DS launch, he said. “My read on” the price “cuts is that they are cautiously lowering price at a slow time of year to see what it does to sales,” but he said, “I don’t see much of a spike coming from these cuts, as they are modest, and the devices still cost a lot. When they cut the DS Lite, I expect to see sales surge.”
As of July 31, a total of more than 42.3 million DS systems across all SKUs had been sold to date in the U.S., NOA said, citing NPD data.
The Xbox Live Gold price increases were announced at the Major Nelson online site that’s run by Larry Hryb, Xbox Live director of programming at Microsoft. In the U.S., the price for one month will rise from $7.99 to $9.99, and three months will rise from $19.99 to $24.99 and one year from $49.99 to $59.99. The one-month plan will rise from 4.99 pounds to 5.99 pounds in the U.K. and from 8.99 Canadian dollars to 9.99 Canadian dollars in Canada. In Mexico, the annual plan will increase from 499 pesos to 599 pesos. Pricing in other regions will remain the same, Hryb said.
But Hryb said that in an effort to “thank our loyal members,” the company was offering the option to “lock in” current pricing with “an additional discount.” In the U.S., that meant one-year plan subscribers could lock in at $39.99 for another year -- $10 less than the current price. Hryb didn’t give the reason for the pricing changes, saying only, “We're confident that when the new pricing takes effect, an Xbox Live Gold membership will continue to offer the best value in the industry."
The Xbox Live increases “seem reasonable to me, considering all of the features they have added in the last couple of years,” said Pachter. “I think a modest 20% increase” after so many years was “not too onerous,” he said.