| Final-Fan said: Even if I grant all the stuff you said, Squilliam, I don't see it making a 37% difference into a 300% difference like you suggest. |
Take an average sale price which is $37 for third party games (and dropping?) then consider you have a lot of games which sell fewer units and therefore find themselves in the higher royalty rate bracket. Then consider that a trickle of units every week (legs) is far more costly in terms of shipping and production than simply making 500,000 units and shipping them at once. Finally consider that as third parties they have double the total number of sales on the Xbox 360 and PS3 with PC sometimes as well, combined, at a faster rate, with a higher average sale price and with the opportunity for additional revenue from DLC. Since the variable costs are lower relative to the sale price it could be as high as 2- 300% of overal Wii revenue for FY2011.
Another answer, people are monkeys and monkeys are irrational.
http://www.ted.com/talks/laurie_santos.html
They are apt to take risks when it involves losses if it also includes the possibility to win big. Since the WIi doesn't offer that, they chose the HD consoles.
Tease.
