Microsoft defends Xbox One pricing, says Kinect and entertainment are key differentiators

Microsoft Yusef Mehdi has defended the Xbox One's pricing, and has stressed that the inclusion of Kinect features, along with a blend of entertainment and games gives it more value than its competitors.

GeekWire reports that during this week's Citi Global Technology Conference, Mehdi explained Microsoft's stance on the Xbox One's £429 / $499 price-point.

He began, "Competitively speaking, I feel like we have a much better and more complete value proposition. We do things that aren't found on other platforms. The Kinect is a huge piece of differentiation, and the fact that we do entertainment and gaming.

"We wanted something to really differentiate that lets you play games as if you're playing movies and we wanted to break the barrier of being able to voice control your television. So to do that, we added a lot of capability. For $499, we think the value we provide for that is a very good deal. We feel that we've done the right balance.

"We're trying to provide a central device in the living room that for the first time can unify all forms of entertainment in one simple effort. We don't just want to unify it, but then allow literally with your voice to control your television. We think TV's will truly become smart TV's where you can browse and do Skype communication and interactive television. Xbox One is key to opening up that world of next-generation entertainment."

Mehdi added that Microsoft looks to make a 'low margin' on Xbox One consoles at launch, rather than a loss. He continued, "The strategy will continue which is that we're looking to be break even or low margin at worst on [Xbox One], and then we make money selling additional games, the Xbox LIVE service and other capabilities on top. And as we can cost reduce our box as we've done with 360, we'll do that to continue to price reduce and get even more competitive with our offering."

Do you feel that the blend of Kinect, entertainment apps and gaming in one central device is worth a higher price threshold? Let us know below.

Via OXM and Videogamer.