Price is right for Nintendo GameCube

Nintendo's $199 price tag and creative assets like Pokemon will make the GameCube a hot seller

In this story: 'The Nintendo magic' Price cut for the PS2? RELATED STORIES, SITES

By CNN's Kristie Lu Stout

TOKYO, Japan (CNN) -- Nintendo has named its GameCube going rate, and analysts say the price is right.

The video game maker plans to price its new GameCube home console at $199 in the United States, a $100 discount to rivals Sony PlayStation 2 and the Microsoft Xbox.

Nintendo's competitive price point and creative assets may turn out to be a winning combination for the game maker in an already heated market.

'The Nintendo magic'

The GameCube's $199 price tag is in marked contrast with the $299 price tag announced last week by Microsoft for its Xbox machine.

"The pricing point is in line with my targets," Lisa Spicer, a games analyst with ING Barings in Tokyo, told CNN.

"This will put Nintendo in a good position."

Nintendo plans to unleash the GameCube on November 3, five days before the Xbox launch date.

GameCube game titles would be priced at $49.90 each, a company spokesman told reporters. Nintendo first unveiled its latest console last week at the Electronic Entertainment Expo (E3) in Los Angeles to much audience enthusiasm.

Analysts say gamers would pick Nintendo's machine over the Xbox for its wide-array of compelling software titles, of which 50 percent are developed in-house.

"You cannot ignore the Nintendo magic on the software side," said Spicer. "It puts them in the pole position ahead of Microsoft."

Industry watchers forecast that Microsoft's video gaming debut in November will be a rocky one.

Third-party game makers like Electronic Arts have yet to receive final versions of the Xbox development software, a delay that could potentially threaten the Xbox's performance during the critical holiday retail season.

Though Microsoft's own titles should be ready by the November 8 launch date, analysts who previewed the games at the E3 trade show were not impressed.

"I think compared to Nintendo, they have a lot of work do to," Takiko Mori, UBSN Warburg's games analyst, told CNN.

Price cut for the PS2?

But Nintendo will nevertheless face stiff competition from the industry incumbent, Sony's PlayStation 2.

Sony is the world's home gaming leader, with 60 percent of the U.S. market held by its PlayStation consoles.

The company recently announced a series of strategic alliances with RealNetworks, Macromedia and AOL to make the PlayStation2 capable of accessing the Internet and playing audio and video files. The tie-ups could ultimately transform the video game machine into a PC and home entertainment hub.

"Sony will still be number one for this year," said ING Baring's Spicer.

Sony Corp launched its PlayStation 2 at a price of $299 last September. Although the company has said it will not lower its price, analysts are forecasting a discount.

"We all assume Sony would do a price cut in the later half of the year," said Spicer.

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