the prof00 said:
"According to analyst Koya Tabata from Credit Suisse, Nintendo’s manufacturing costs for the Wii have almost halved since the console’s introduction in 2006. The analyst cites a 45% decrease in costs hardware costs, however, that does not translate in 45% more profits for Nintendo, as fixed costs (such as packaging, transportation etc.), remain the same."
Actually, what is cited here as fixed costs can be variable. The price of a gallon of gasoline in the US is 62.5% of what it was a year ago.
Also, others have downplayed Nintendo's ability to get price reductions because of using older technology and thus all process-based reductions have already occurred and technology where either it is the only customer or where there are already so many customers that economies of scale have been maximized.
Mike from Morgantown
 I am Mario.I like to jump around, and would lead a fairly serene and aimless existence if it weren't for my friends always getting into trouble. I love to help out, even when it puts me at risk. I seem to make friends with people who just can't stay out of trouble. Wii Friend Code: 1624 6601 1126 1492 NNID: Mike_INTV |
