A new survey by Merrill Lynch suggests that Microsoft's XBox 360 will become more popular with gamers, mainly due to its price. The latest information about Sony's PS3 online strategy for games will also not help if it is shown to be true.
According to Merrill Lynch there exists a huge cost difference that may see X360 selling at half the price of PS3 by the end of 2006. The investment company analysed the components for both consoles and their cost and suggests that, PS3 will not only be significantly more costly than Xbox 360 at launch, but will continue to operate at a cost disadvantage for several years. Merrill Lynch seems to suggest that the price for PS3 may be as high as USD 500 at launch, in spring 2006, while X360 may be selling for as low as USD 249 by then. Microsoft has announced two versions of the XBox 360 console which will be priced at USD 300 (standard edition) and USD 400 (premium edition).
According to the survey up to 10 million X360 consoles could be sold by the end of 2006, something which would mean that Microsoft may be able to lower prices even further. The main point made by the survey is the risk that Sony is running by using the Cell processor. A lot of a manufacturer's pricing flexibility comes as a result from increased usage of a part but Merrill Lynch claims that Sony's chances of convincing manufacturers to use the Cell processor outside the PS3, are slim. Apple for example has moved away from IBM and is expected to be using Intel processors by the end of 2007.
The survey suggests that the Cell processor will cost Sony USD 160 per chip while MS will have to pay USD 100 for its PowerPC while Sony will also have to dish out USD 75 for the privilege of using a Blu-Ray drive on PS3. All this information, coupled with Sony's weakened financial position and Microsoft's head start, suggests to the investment company that X360 will take a comfortable lead in the next-gen console wars.
New information, suggesting that Sony has chosen not to offer a centralized online gaming to PS3 owners, has caused further grumpiness among analysts since it will be up to each developer to offer an online service and to, possibly, a separate fee for every game.
This choice would make things easier for Sony as each developer will be ultimately responsible for the quality and cost of the service it offers but gamers may need to have a separate account for each game and may have to pay extra to enable online play for each game.
This information however, remains a rumor until Sony decides to release some further PS3 information.