Microsoft Prepared For the Winter of Our Economic Discontent

Microsoft may not be looking at further price cuts for their console as the country tip-toes through this recession, but they're looking at ways to make their console attractive to thrift-minded families.

"I don't think anyone anticipated the current economic situation," Aaron Greenberg, group product manager for Xbox 360 said. "We are fortunate to be able to lower our price on our products, offer a great value at a time when consumers are being much more picky. People are staying home more, people are making more family purchases than the past, devices that can deliver a variety of entertainment.

"I think that's benefited us tremendously, the fact that the Arcade (Xbox 360) is even cheaper than the Wii has helped us. We will continue to take our great price and add more value to it."

Unfortunately, it doesn't sound like that increased value could come from a drop in the price of Xbox Live, one of the few mainstays of the console that hasn't been reduced in price since its launch.

Greenberg calls Xbox Live Gold, which costs about $8 a month, an "upsale experience" and doesn't seem to think that gamers will be seeing a drop in its price anytime soon. (Live costs $50 if you pay for a year's membership up front)

"I think we have seen people are willing to pay for the premium experience," he said. "When they compare Live, even to Home, there is still a huge gap."

And Greenberg isn't a big fan of Sony's Home service, set to launch it's open beta tomorrow.

"What Home to me feels like is Second Life for hardcore gamers," he said, "it doesn’t feel like it broadens the experience and invites people in. When they unveiled it, it seemed innovative. I think what's happened is now here we are a couple of years later and we feel beyond that.

"It feels like 2005 tech in 2008. I'm not sure that’s what people want."