Nintendo drops price on GBA

DSN Retailing Today, Sept 20, 2004

Nintendo's decision to cut the price of its Game Boy Advance console is welcome news for retailers but it's not clear whether the move will spur other game companies to follow suit.

Nintendo on Sept. 1 reduced the price of its popular Game Boy Advance handheld console by $20 from $99 to $79, a move that's expected to drive sales.

"This price point makes Game Boy Advance affordable for the vast majority of the mass market and gives people a 'gotta have' gift to put at the top of their holiday gift list," said George Harrison, vp of marketing and corporate communications for Nintendo.

The surprise price cut may prompt other companies to lower prices as well. Sony and Microsoft lowered the price of their Playstation 2 and Xbox consoles to $149 in May but, so far, neither company has indicated more cuts are in-store.

Industry analyst David Cole said there's always talk of price cuts heading into the holidays, but that they of ten never happen.

"I think the only way you'll see price cuts is if console sales are slow and they need to do something to get them going," said Cole, president of DFC Intelligence.

"But you'll probably see the companies bundling games and consoles together to offer more value to consumers."

He said a new crop of hot games such as Halo 2 and Grand Theft Auto: San Andreas should give the industry enough ammunition to drive holiday sales without lowering prices.