Kotick: Consoles should hit $199 in 2 years

Activision chairman and CEO Robert Kotick has told a conference in New York that he believes all of the next-generation consoles need to drop in price to USD 199 at some point within the next two years.

He said that the PlayStation 3 was a "good product" but that Nintendo's "wildly popular Wii was leading the way" at the Reuters Media Summit.

"The Wii at its price point is now setting a standard and an expectation, and people say, well, the Wii is less complex technically. I don't think that really matters as much to the consumer."

He noted that USD 199 was the key price point for mass adoption, and that the lower price would give Activision and other publishers a larger potential market - which would in turn lead to potentially larger game revenues.

"In the next 24 months they all will need to be at that USD 199 price point, and you can imagine Nintendo will be down to the USD 129 price point over the next few years."

Kotick went on to talk about Activision's policy for Wii games, and how the company has had to adjust its strategy in light of Nintendo's first party title dominance.

"We realized that, much like Nintendo, the pathway for success and the highest operating margin leverage on the Wii is a relatively small number of titles that really capitalize on capabilities of the hardware.

"Some of our competitors are doing a lot more talking about how they're organized than innovating for the Wii and if [publishers] are going to be successful they are going to have to step up to the level of innovation that Nintendo has proven themselves capable of."

Finally Kotick also hinted that Guitar Hero III might be the title that helps them break fully into Asian markets.

"We've never really had any content that would appeal to the Chinese consumer, to the Korean consumer, and this is a kind of content that lends itself very well to commercialization online.

"It's a natural thing to add as a different type of social experience within those environments so I think that's something you can envision us doing over time."

Activision raised its financial outlook for the third fiscal quarter and full year yesterday, a move which saw the company's share price jump over 12 per cent across the day.