Microsoft Cuts Xbox 360 Prices in Four Asian Markets (Update4)

April 29 (Bloomberg) -- Microsoft Corp., the maker of the Xbox 360 video-game console, cut prices on the system in four Asian markets to help stem market-share losses to Nintendo Co. and Sony Corp.

The Redmond, Washington-based company reduced estimated retail prices in Hong Kong, South Korea, Singapore and Taiwan, Brenda Hsieh, a Microsoft spokeswoman in Taipei, said today.

The cuts follow price reductions in Europe that led Xbox 360 sales to double. Microsoft has had trouble breaking into the Asian market because of the dominance of Kyoto, Japan-based Nintendo and different game preferences in Asia, Jeff Bell, the vice president of global marketing for Microsoft's interactive entertainment business, said in an interview last week.

The price of a basic version will drop by 17 percent to NT$10,360 ($340) in Taiwan and by about 11 percent in Hong Kong effective today, Hsieh said. Prices will fall 5.1 percent to 369,000 won ($369) in Korea and by 20 percent to S$499 ($366) in Singapore, according to separate e-mailed statements.

Microsoft, also the world's largest software maker, fell 35 cents to $28.64 in Nasdaq Stock Market trading at 4 p.m. New York time. The shares have dropped 20 percent this year.

Last month, Microsoft cut the price of the Xbox 360 in Europe for the at least the second time in a year to win customers from Sony and Nintendo. The basic Arcade console fell to 199.99 euros ($311.38) from 279.99 euros, and the model with a 20-gigabyte hard drive dropped 80 euros to 269.99 euros.

Global Shipments

Global Xbox 360 shipments will probably fall 40 percent to 9.1 million units in the year ending in March 2009 after peaking during the previous 12-month period, Daiwa Institute of Research Ltd. estimated last month. Shipments of Sony's PlayStation 3 will jump 47 percent to 14 million units, while those of Nintendo's Wii may rise 26 percent to 24 million, according to Daiwa.

The unit that sells the Xbox, along with Microsoft's Zune digital music player and Windows for mobile phones, accounted for about 12 percent of Microsoft's $51.1 billion in revenue in the last fiscal year. The entertainment and device division was the fastest-growing business, with sales rising 28 percent.

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To contact the reporters on this story: Chinmei Sung in Taipei at csung4@bloomberg.net; Amy Thomson in New York at athomson6@bloomberg.net

To contact the editor responsible for this story: Young-Sam Cho at ycho2@bloomberg.net.