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Microsoft Raises Kinect Forecast to 5 Million Units

The Microsoft Kinect, bottom, costs $149.99 alone and comes bundled with Xbox machines, starting at $299.99. Source: Microsoft Corp. via Bloomberg
The Microsoft Kinect, bottom, costs $149.99 alone and comes bundled with Xbox machines, starting at $299.99. Source: Microsoft Corp. via Bloomberg

Nov. 3 (Bloomberg) -- Microsoft Corp. boosted its forecast for the Kinect motion-control device for the Xbox gaming system to 5 million units this quarter, predicting the most successful Xbox product debut by sales.

Based on pre-sales, retail orders and consumer interest, the company expects to exceed a previous forecast of 3 million units, Don Mattrick, president of Microsoft’s Interactive Entertainment Business, said in an interview today. The device, which lets players control games with motion and voice, goes on sale tomorrow.

Microsoft and Sony Corp., with its Move controller, are competing against Nintendo Co., whose Wii machine set the standard for motion-controlled gaming. Microsoft, based in Redmond, Washington, is using Kinect to attract a larger slice of the market for casual gamers, while extending the life of its Xbox 360 console, which went on sale in 2005.

Sony has been selling Move since mid-September. Michael Pachter, a video-game analyst at Wedbush Securities Inc. in Los Angeles, predicted Sony will sell about 3 million units by the end of this year.

Microsoft dropped 36 cents to $27.03 at 4 p.m. New York time in Nasdaq Stock Market trading. The shares have fallen 11 percent this year.

Price Tag

Kinect costs $149.99 alone and comes bundled with Xbox machines, starting at $299.99. It sold out in preorders at retailers such as Amazon.com Inc., Best Buy Co. and GameStop Corp., according to David Hufford, a Microsoft spokesman. Those stores will have more stock when the product goes on sale tomorrow, he said.

In the U.S., 25,000 retailers will sell the device and 5,000 of those will stay open tonight for customers who want to purchase Kinect at midnight. Microsoft is holding a midnight event at the Toys “R” Us store in New York’s Times Square, Mattrick said.

“They are really defining Kinect as the must-have holiday item,” Mattrick said of retailers. “It means it’s going to be our biggest holiday ever.”

To contact the reporters on this story: Dina Bass in Seattle at dbass2@bloomberg.net

To contact the editor responsible for this story: Tom Giles at tgiles5@bloomberg.net

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