When the original PlayStation debuted 20 years ago it was $300. The Sega Saturn that it competed against was $400. That kind of puts the price of the $350 Xbone and $400 PS4 bundles in a new perspective. Twenty years of progress following Moore's Law means that the newest consoles are approximately 2^10 times as powerful as the original PS for the same price. Take inflation into account and the new consoles are a bargain.
When the system hit store shelves 20 years ago in Japan (it wouldn't launch in North America for another nine months), gamers liked that the $300 system was $100 cheaper than the competing Sega Saturn. Source