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Xbox One predicted to cost $400, according to Wedbush Securities analysts

Xbox One

Microsoft has yet to reveal pricing for its upcoming Xbox One entertainment console, but that isn’t stopping one analyst at Wedbush Securities from “predicting” the pricing to be $400. In fact, this analyst believes the Xbox One will cost $50 more than the upcoming PlayStation 4 from Sony.

“For [Xbox One], we believe a starting price of $399 makes sense given that the Xbox 360 Pro debuted at that price point in November 2005. Our estimate of the bill of materials for the Xbox One – based upon speculation regarding many of the specs – is around $325, suggesting that Microsoft could make a modest profit at the $399 price point. For the PS4, we remain confident that the new console will have a lower initial MSRP than the PS3, which had a lofty starting price of $599 that we believe negatively impacted its long-term popularity. We expect the PS4 to debut at $349, as our estimate of the bill of materials is $275,” two analysts over at Wedbush Securities stated.

These two analysts, Michael Pachter and Nick McKay believe that Microsoft will price the Xbox One more than the Sony PS4 due to a higher cost in components for the Xbox One. While the $400 figure isn’t the official word from Microsoft, these analysts typically offer a prediction on the cost to aid investors. Microsoft may reveal pricing for the Xbox One during the E3 conference this month, or perhaps even later in the year.

The analysts believe that Microsoft may be going the “subscription” route to offset the higher cost of the Xbox One. “We believe the ability to watch live TV from a cable, [telecom company], or satellite set-top box through Xbox One could entice [Microsoft] to drive subscriptions through a subsidized box in exchange for a multiyear contract. The ‘always connected’ requirement for the Xbox One likely means that a broadband connection will be required, suggesting to us that ISPs may have an incentive to offer a subsidy as well. In addition, Microsoft could conceivably subsidize the Xbox One through prepaid Xbox Live Gold subscriptions – as it has done on a limited basis in the past – or premium Skype functionality as well,” the analysts add.

We are expecting to hear more about the Xbox One at the E3 conference in a few weeks. Stay tuned.

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