Am I the only one that thinks Vita will sell less in 2013 than 2012?

[Chark]

Jumpin said:

Chark said:

Yes and those cost have been relatively applied to support at cost or slight profit on hardware. There are a variety of alternatives to ending the product. Ending the Vita has to be among the worst possibilties. It is not a safe backing out but a complete failure and damaging to their business.

Do you have numbers to back that up? Because operating costs are going to outstrip profits if a system sells below a certain threshold. It's not like Sony goes into a store and buys each Vita for 240$ USD and sells them for 250$ USD, they're responsible for paying the salaries and bills of everything and everyone involved in the production along with the expense of all other operating costs.

Numbers are buried somewhere, but they are working off of estimates and comparisons. Namely Wii and 3DS.

Starting at the $160 teardown mark (same as Wii), from there add estimates for assembly cost, shipping, along with wholesale and retail cuts. The retail cut is small judging by every other system (the Wii only had a $4 cut) and wholesale cuts typically match retail. The Vita is smaller than a home console and benefits from cheaper shipping costs. It is known that the Wii wasn't being sold for a loss, launching at $250. The Vita has a $250 SKU and a $300 SKU, with the cost of a 3G chip being around $3 or less, there is far greater potential to be acheiving profits.

The 3DS was originally sold at a profit at $250 and later at a loss for $170. The manufacturing cost of the device is around $100. So at least for the 3DS the $70 cushion wasn't enough for a profit to be generated. The Vita has a $90 to $140 cushion. So if after manufacturing costs are enough to make Vita sell at a loss than the 3DS is selling for at least a $20 loss after the price cut. If so the 3DS was originally landing Nintendo a $60 profit ($250-$100-$90). Now if the 3G vita was even being sold at a loss than the 3DS was taking a $70 loss after price cut while at $250 was making Nintendo only $10 ($250-$100-$140). 

So, though it is a different product by a different company and compared to an older product, in order for Vita to be taking a loss, the 3DS would have to barely be making any profit at $250 and taking a massive loss at $170 (a loss Nintendo has already eliminated in less than a year). Along with some massive unseen price discrepancy for post manufacturing from the Vita to the Wii.

There is no evidence to suggest Vita is being sold at a loss to contradict this analysis. Some people will try to quote an interview with Kaz talking about profitability on the Vita in three years. The article they site is wrongly titled to say the Vita is being sold at a loss, but the interview refers to the Vita providing return on investment in 3 years. So don't listen to those people because it is a lie. So aside from that thin skinned attempt, no one has provided any evidence towards selling at a loss.

Now there is a chance that the numbers fall towards the wifi Vita selling at a loss and the 3G selling at a profit, quite possible. Without knowning if that is true or at what level of loss or profit each system creates, it is too hard to determine total profitability or loss for the hardware and the best route would be to advocate break even for the system.