Microsoft CEO Steve Ballmer has rubbished suggestions that the Xbox 360 price cut was a last-ditch attempt to spur sales going into Christmas, arguing that the console is "an absolute home run".
Asked by Mercury News whether the price cut - announced sometime after a successful E3 - was 'an indication you have run out of ideas to boost sales', Ballmer was robust: "No, that's the craziest thing I've ever heard anybody say," he scolded. "All consoles start at higher prices. They always come down through the long cycle."
Pressed as to why Microsoft would cut the price at all given the strength of its E3 line-up, Ballmer explained: "Price is not something you discuss externally. Nobody ever does. So, whether we were planning on cutting price the next day or in six months or a year, we're not going to discuss price changes.
"If you ask me, Xbox Live is going gangbusters. The console is selling well," he added. Xbox Live recently broke through the 12-million member barrier, although Microsoft has not revealed what percentage pay the monthly or annual subscription fee compared to the free alternative.
Microsoft cut the US price of the Xbox 360 in early September, and followed with a European price cut a fortnight later. The base-level Xbox 360 Arcade with no hard disk costs USD 199.99 / GBP 129.99 / EUR 179.99, while the mid-range model with a 60GB hard disk, often called the Xbox 360 Premium, costs USD 249.99 / GBP 169.99 / EUR 239.99, and the top-level Xbox 360 Elite costs USD 399.99 / GBP 229.99 / EUR 299.99.
In comparison, the 80GB PS3 costs USD 399.99 / GBP 299.99 and the Wii costs USD 249.99 / GBP 179.99.