Dr.Henry_Killinger said:
shikamaru317 said:
Last year the production cost of the system with Kinect was estimated at $471. $75 of that was for the Kinect, which was removed in June, it's now optional. That would put the production cost of the system at $397. However, system construction costs decrease over time, and given that nearly a year has passed since the initial cost breakdown, it's likely that production costs are around $350 now. So the only money they're losing is on the bundled game, and they've been bundling digital codes to cut costs on that front.
It's also worth noting that the estimated production costs for Xbox One accessories are low enough that they're making a nice premium on accessory sales, which offsets what they're losing on console sales. The standalone Kinect sells for $150 but costs $75 to make. The controllers sell for $50 but cost $15 to make. The play and charge kits sell for $25 but likely cost less than half of that to make.
Remember, selling a console at a loss isn't always a bad idea. The more consoles you sell earlier in the generation, the more software and accessories you sell throughout the generation. And console manufacturers get money for every game sold due to licensing costs, and even more for 1st party games. Anything they're losing now they'll make back later in the generation through increased game sales, increased accessory sales, and increased XBL subs.
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Manufacturing costs do not drop that fast.
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I think he is pretty close, When you are selling millions of units. Also what's you reason for stating this? Just a random thought?
