Supermarket chain Morrisons has announced a week-long promotion offering console chart games for up to half price, a move that could ignite a "very bloody" retail war in the run up to Christmas, according to one analyst.
"The opening salvo in what could turn out to be a very bloody war was fired yesterday by Morrisons," David O'Brien of European investment banking group Altium Securities told The Guardian. "Game Group has a price promise and as a result will be forced to match the levels offered by the food retailer.
"We think it highly likely that other retailers will follow suit in the run-up to Christmas, resulting not only in Game Group being forced to price match but also to increase its promotional spend in the press and on TV.
"Our expectation is that little help will come from hardware sales, as Microsoft has just reduced the entry price of the Xbox 360 to US$199 (£115), with Sony likely to follow suit.
"We think the above combination is likely to result in a reining in of profit estimates closer to Christmas."
Approaching midday trading on Wednesday Game shares had fallen by 2.66 percent to 237.5 pence, having closed at 244 pence on the London Stock Exchange on Tuesday.
Article supplied by Edge-Online