MS to Offer Cheaper Core X360 in Japan Before PS3

September 08, 2006 | By: James Brightman

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It's no secret that the Xbox and now the Xbox 360 have struggled in the Japanese market. Now Microsoft Japan is about to introduce a cheaper Core version of the console in Japan in the hope that it will boost lagging sales. But will gamers care?

Japan—it's the country that Microsoft just can't seem to crack. For all of the company's efforts to appeal to Japanese gamers' tastes, Microsoft has only managed to sell through 158,654 units as of early September, according to Enterbrain Inc. That's a pretty paltry sum when the worldwide total is over 5 million.

In an effort to spark sales in the region, however, Microsoft said today that it will launch a new, cheaper Xbox 360 SKU, according to reports from online news agencies such as the AP, Bloomberg and Reuters. In Japan on November 2, a 360 system without a hard drive or other accessories will go on sale for 29,800 yen (about $256), which is about 10,000 yen less than the standard model. This is quite similar to the Core System 360 that sells for $299 in the U.S. Microsoft Japan will also offer two free games for a limited time in order to attract potential buyers.

The cheaper 360 in Japan goes on sale just one week before Sony's PlayStation 3 makes its much anticipated debut. With the news that only about 100,000 units will be available at launch in Japan, however, Microsoft is hoping that it can capitalize on the shortage and entice Japanese gamers to pick up a 360 instead.

The problem, though, is that offering what's in effect a Core pack may not be the right move. After all, in the U.S. and other territories where both the Premium and Core SKUs have been sold, most gamers seem to be opting for the Premium version that comes with the 20GB hard drive, component cables, a wireless controller and more. Microsoft said that it plans to start selling the hard drive separately in Japan for 9,500 yen, but will gamers care about the Core version if they were never interested in Xbox 360 to begin with?

"The Xbox 360 has barely sold in Japan and I really can't imagine that doing a cut-down version is a solution,'' David Gibson, an analyst at Macquarie Securities Ltd. in Tokyo, told Bloomberg.com. "Software is the key determinant and the right products are not there' for Microsoft."

With the 360 Microsoft has done more to court Japanese developers, such as Final Fantasy creator Hironobu Sakaguchi, but with the PS3 and Wii fast approaching it just might not be enough to attract gamers in Japan.