This is according to the CEO of Microsoft Gaming, Phil Spencer, who told The Verge the team decided instead to focus its effort on delivering the smart TV streaming app to Samsung sets (thanks, ResetEra). “[Keystone] was more expensive than we wanted it to be when we actually built it out with the hardware that we had inside,” said Spencer. “We decided to focus that team’s effort on delivering the smart TV streaming app. With Keystone, we’re still focused on it and watching when we can get the right cost. “I think for a streaming-only box to make sense, the price delta to Xbox S has to be pretty significant. I want to be able to include a controller in it when we go do that. It was really just about whether we could build the right product at the right price, or if we couldn’t, how could we focus the team’s effort? We decided to go do the TV app with Samsung, and we’re really happy with the results there.” A “right price,” says Spencer, would fall into the ballpark of around $129 or $99 for it “to make sense.” “When you are building new products, it’s always about, do you have the right design? Do you have the right user interface? Do you have the right customer proposition? That customer proposition includes the price, and I think all of us knew that we were a little out of position on price.” Spencer went on to say that some of the silicon choices Microsoft was making at the time of designing the device “just didn’t let us hit the price point that we wanted.”
