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The Video Game Shoot Out

Techstination feature for Wednesday, May 22, 2002

The video game shoot out. Bloomberg Boot Camp, a report on today's technology. Sony and Microsoft are shooting it out to win customers for their latest generation video game consoles. Just before the start of the Electronic Entertainment Expo trade show in Los Angeles this week... ..both companies slashed the prices of their machines. Both the Playstation2 and the Xbox now sell for 199 dollars... and Nintendo's GameCube has dropped to 150. John O'Rourke, Microsoft's director of worldwide marketing for the Xbox... the expectation is the price cuts will prompt more people to buy...

"What will happen is a number of gamers who've been holding back to sort of wait and see or wait for the next price reduction, they'll now suddenly have the chance and the motivation to get into the marketplace."

While Microsoft and others typically lose money on the consoles... .they make their profits on game sales... and the licensing fees paid by third party game publishers. One of the fastest growing is THQ, where CEO Brian Farrell couldn't be happier...

"We love the battle between Microsoft and Sony and if you throw Nintendo into the mix, what you have for the first time in our industry are three very strong, very powerful competitors. So for software publishers, our view is those guys make the razors, we make the blades, so the more bloody and fierce their competition the better it is for us."

(sound) You get the idea. Farrell believes the video game renaissance is in its early stages and the market could double in size over the next three years. Bloomberg Boot Camp, I'm Fred Fishkin.