Most people semi-familiar with the video game industry know the economic basics of it too (IE - At launch, eat a loss on hardware, make money on software).
With Sony just dropping the price of the PS2 to $200 US and Microsoft being “forced” into following suit, how much does MS lose on each unit sold?
I am guessing that Sony is now to the point of breaking even (if not turning a profit) on the PS2 hardware now as it is about 2 years old, but I really doubt that MS is doing the same.
I had read once that MS was already loosing 100-200 bucks per Xbox. So, a price cut would cause even more.
about .0000000001% of its reserves. I am sure it is not losing too much sleep at the minute
But… do you really think that the entire cost of manufacturing an X-Box exceeds $200? Microsoft doesn’t have to pay anywhere near as much as Joe Shmoe, average American consumer, for hardware, and the software is theirs, so…
Microsoft has been losing between $76 and $105 on every Xbox sold at the $299 price. Add a $100 to the loss at the new price.
Latest news is that maunfacturing will be moved from Hungary to Doumen, China to cut production costs.
Thus saith MSNBC in this link. And that’s at the old price! Maybe they make a lot of money licensing to the game manufacturers.
I also read that Sony is now turning a small profit at the 199 price…due to manufacturing process improvements and product redesigns.
I still wouldn’t buy an XBOX at 199, I had one and sold it. There just aren’t any games on it.
i think a chunk of xbox cost goes to nvidia and that probably is why MS is losing money…
sure the hard drive, ram and cpu can be bought at $10 each probably… but the graphics chip… graphics cards that level cost $200-300… plus the sound, the dvd, the R&D, the custom cables,…