JEMC said:
Precisely. There are many things that, even though we know they are in the console, we don't know which kind of they are. For example we know that it has a total 2GB of RAM but, which kind of RAM? Etc. And also remember that those 25k yen includes the profit margin for the stores, which we also ignore. |
Profit margins for stores is a measly $2-to-$5 in the US so its almost nothing.
Well I will use the 3DS as a model and adjuct for better retail tactics for the Wii U. The parts for the 3DS it self was estimated to be a little over $100 when it launched.
http://www.tomsguide.com/us/3DS-Price-Cost-Spare-Parts-Repairs,news-10605.html
That would set just the parts as 40.4% of the cost for the console. There is other cost involved labor, logistics, marketing, retailer "cut", but in view of this guess just for the parts. When Nintendo cut the price the system they where initially making money on was then losing money with each unit sold. I'm using my experience in managment and what I know from how the stingy owner runs it there is a "rule of the 20s" (a little over 20% labor 20% in varible costs) So let's say 45% is the labor and varible costs (the parts are a "fixed" cost).
That brings us to 86% of the console revenue being "eaten up" by the losses. That leaves Nitnendo with about 14% profit or $35. Using this backward and using the rules of the 20's as a fixed cost, using the 45% and reducing profits to $10 per console we get about 50.5% of the console being parts. (I skiped a few steps, since I don't want this to get too long.)
Using this percentage against the yen retail cost of the Wii U we get 12625 yen as the cost of the components. But this is just a very theorectical guess. ($162.65US in current excange rates.)
