Microsoft is prepared to lower the price of the Xbox One, but only if it falls behind in the race with the PS4.
That's the opinion of Wedbush analyst Michael Patcher.
However, he doubts that it will be necessary, especially since the u-turn on its DRM policies for the Xbox One.
Speaking to investors, he said that he believes Microsoft could still emerge out on top of the next generation, despite the false start.
"Microsoft intends to offer a more robust hardware bundle than Sony will offer, and Microsoft is convinced that consumers will ultimately appreciate the value proposition presented by Kinect," Pachter told investors.
"Microsoft has not done a particularly good job of communicating the value proposition to consumers, but today's announcement will remove an impediment to the company's ability to get its message across.
"We are confident that with six months of focused messaging, Microsoft can fully level the playing field with Sony, and we expect the Xbox One to sell as many units as the PS4.
However, should he be wrong and Microsoft fails to sell as well, if not better than the PS4, he fully expects the company will lower the price of the Xbox One.
"If we are wrong, we think that Microsoft is prepared to lower price next year."