Wedbush Morgan Securities' Michael Pachter doesn't believe Microsoft will release a new Xbox console next year, contrary to a recent report.
“We will see new SKUs often, with ever increasing hard drives, DVR functionality, probably Internet TV and HDTV tuners built in, but we won't see anything that requires a retooling of software development," Pachter told us.
“If they don't change the CPU/GPU combination, it's not a new console, it's a new SKU. There have been five so far, and this reinforces the commitment to the current cycle. Changing the control scheme to a Natal scheme won't be that complicated for most developers, but retooling for a faster CPU or higher resolution GPU could cost developers a lot of money and time.”
Screen Digest analyst Piers Harding-Rolls also told us that he doesn't expect to see a new Xbox boasting improved processing and graphical capabilities any time soon. “I believe the idea of an upgraded Xbox 360 that plays better looking and performing games is entirely speculative and unlikely at this stage.”
He noted that future home console hardware upgrades will likely be more iterative than substantive. "I would also suggest that most major upgrades would be around the form factor, connectivity, functionality and storage of the device and not centered on more core issues such as its processing and graphics capability, which would potentially split the addressable market... We've already seen this strategy in the handheld market with the DS/DS Lite/DSi, PSP/PSP Slim and Lite/PSP3000/PSP Go, yet both sets of devices still play the same quality of games and it is safe to assume that the TV console market is likely to develop in the same way."
Pachter also said that a Natal-equipped Xbox 360 could carry a price point similar to current 360 SKUs. "Microsoft needs to target the mainstream, as they have already succeeded with the hardcore. I think that Project Natal is intended to hold off the inevitable launch of Wii Plus (HD), likely coming around the same time. Nintendo looks to me to be on track to launch a new console that is up to the Xbox 360 technical standard some time late next year, and I think that Microsoft intends to respond with a Natal-equipped console of its own at a similar price. My guess is that a Natal-equipped 360 with a large hard drive and DVR functionality could be priced around the same as the current core Xbox 360.”
On potential Natal Xbox 360 bundles and pricing, Harding-Rolls added: "Microsoft's aim is to get the technology to as many users as possible, so I expect the company to be looking at both hardware and software bundling strategies and straight forward accessory sales as a way to get the product into the market. Rumours suggesting the [Natal] camera and technology will retail at around $200 standalone seem wide of the mark. We've seen that Nintendo has had great success with the combined Wii console and Wii Fit/Balance Board price point ($250 + $90) and we would assume that Microsoft would try and emulate that sort of costing when releasing the technology.”