During the latest episode of Game Trailers’ Bonus Round, Wedbush Securities’ videogame, media and electronics analyst Michael Pachter thinks that the Xbox One’s Kinect has almost become “irrelevant” in light of smartphone and tablet adoption in households. Because Don Mattrick has left Microsoft (and is now the CEO of Zynga), Pachter thinks that the Kinect is going to be removed from the Xbox One bundle in 2015.
“Kinect was Don Mattrick’s favorite child. He believed in it, he thought it was gonna change the world. He believed it a mechanism to cross sell Skype and to cross sell cable access and doing other things. I think that as Microsoft developed Skype, they recognized how fast smartphones and tablets have been adopted and I think the overlap of Xbox One households and smartphones and tablets households is probably a hundred percent. I think that Kinect has become almost irrelevant,” Pachter explained.
“I think Skype is a really cool app, but FaceTime works. You don’t really need that Skype in your living room… It’s better if everybody is on the couch, but FaceTime works. I think the voice command is really cool, but you can use your tablet. The answer is: Don isn’t there anymore. You have a new boss over the Xbox division, who has no skin in the Kinect game, so… Sure they’re gonna unbundle. Not in 2014. They will not change the SKU that dramatically in the first full year. It’s a 2015 event.”
If the Kinect was removed from the Xbox One console bundle, Pachter continued, it would allow for Microsoft to cut the Xbox One’s price. To do this, however, the Xbox One would need to be “dumbed down,” meaning that, similar to the Arcade and Pro versions of the Xbox 360, there would have to be two varieties of Xbox One: a core model that may have a 2Tb hard drive with the Kinect included, and another with a 500Gb hard drive (what the Xbox One currently holds now) without the Kinect included. Even if the Xbox One does have its price cut by 2015, Pachter thinks that Sony will still be ahead of Microsoft with its PlayStation 4.
“Just the way they introduced the 4 GB Xbox after a couple years, they’ll bring one out and it’ll be something that’ll look a little dumbed down… I think they’ll actually pick the core model and put a 2 TB hard drive in it, and then the dumbed down one will have a 500 GB hard drive, and it’ll have no Kinect, and it’ll be 400 bucks.” Pachter continued.
“That’s the easiest way to do the price cut. The problem is that if by spring ’15 they cut the price to $400, Sony goes 349 for ours! Sony right now is in a position to stay ahead of them, and this is what happened with the PS2. PS2 kept taking share by cutting price. I think this is a price game. I think unbundling Kinect is the smartest way to get competitive right away.“