$349 Xbox One is here to stay, says Michael Pachter

Industry analyst Michael Pachter isn't convinced that Microsoft has any intention of returning the Xbox One back to its original price of $399.

The company first implemented the $50 discount in November as sort of a holiday promotion, and immediately saw promising results. Following a successful holiday season which saw the Xbox One overtake the PS4 in sales in the U.S. for November and December 2014, the price returned to the standard $399. That was only temporary, though, as Microsoft celebrated the news by reintroducing the $349 Xbox One in January, with no timeframe for how long the promotion would last.

“On January 16 they said ‘Effective tomorrow we have special promotional pricing of $349.’ It didn’t say temporary, and it didn’t put a date of when it ends, which is really curious,” Pachter said, speaking to GameInformer.

“It’s not officially a price cut – it’s promotional pricing. This allows the retailer to advertise regularly $399 and now it’s $349, but I have a feeling it will never go back up.”

Pachter went on to say that unbundling the Kinect — which allowed Microsoft more competitive pricing with Sony's PS4 — "was the right idea," but pointed out that the Xbox One didn't actually start outselling the PlayStation 4 "until they cut the price to $349 and started giving away free games."

Although Microsoft told Polygon that the promotion was temporary, I have a hard time believing Microsoft will return the price to $399. Technology only gets cheaper as time passes, and with the Xbox One turning two this November, I fully expect bigger discounts and more attractive incentives.