Activision CEO: Microsoft must prove Xbox One’s $499 price ‘is worth it’

Activision's Eric Hirshberg isn't concerned with the $499 price tag for the Xbox One, as it's the console maker's job to "win the value argument," but the CEO does believe it's up to Microsoft to "convince people that the higher price point is worth it."

Sony's PlayStation 4 is currently retailing for $399, $100 cheaper than the Xbox One. Hirshberg believes this lower price puts Sony in a stronger position at first glance.

"If you do a focus group of a gazillion people and you show them two prices for two competitive products, 100 percent always prefer the lower price. I think from a first impression standpoint the win goes to Sony, at least as it relates to pricing," Hirshberg told GamesIndustry. "Microsoft is going to have to win the hearts and minds and convince people that the higher price point is worth it, and that it provides really meaningful capabilities that will be meaningful to consumers. And it's a long game, so I am sure that's what they intend on trying to do."

Part of the reason the Xbox One is priced higher than its competition is due to the inclusion of the Kinect peripheral with each system. While consumers have been more than willing to sacrifice the Kinect for a cheaper Xbox One, Microsoft has been unwavering in its stance that the Xbox One and Kinect are hand-in-hand. Although the Kinect can be powered off, it must at least be connected to the Xbox One for the system to operate. But is the added cost worth whatever functionality the Kinect may bring to your living room?

"I think it's the same answer; I feel they have to show why that's a good thing and why it's worth the premium and deserves inclusion and why it's something that gamers are going to come to really value and appreciate," Hirshberg explained.

"It's going to be a fun battle to watch, but I think they definitely have to win hearts and minds in terms of the value of it," he concluded.