Superman4 said:
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I think you need to be introduced to the Gamecube which was more powerful than the PS2, sold for $100 less, and Nintendo didn't come close to losing as much money on hardware as Sony did.
Here is a rough calculation for the cost of the Wii U console released at the end of 2012:
$125 (fixed cost)
+ $25 * performance multiple over XBox 360
+ premium cost of Wii U controller over conventional controller
If you assume it will cost $25 more for a Wii U controller than an XBox 360 controller (a reasonable estimate) and the Wii U is 4 times the performance of the XBox 360 (also a reasonable estimate) the Wii U could probably be sold for $250; if the Wii U was closer to 8 times the performance of the XBox 360 I would expect the cost to be closer to $350, and 16 times the performance would be around $550. All estimates within $50 either way.
Certainly, a conventional generational jump (8 to 32 times the performance) would result in a very expensive system; but a moderate performance improvement of 4 to 8 times would still leave the Wii U in a price range people are used to paying.