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Steamboy is sold at a large profit margin though because the manufacturer doesn't make money off games, and Nintendo is also a much larger vendor that can order parts in huge volume (millions) so they get better pricing on parts.

That said I don't think it would be the worst idea in the world if Nintendo went with a slightly higher price point this time around ... say $219.99 or $229.99 at launch.

As long as they have strong games at launch this time around (Mario, Zelda, Dragon Quest XI, ahem) and launch closer to the holidays, I don't think they'll have the same problems the 3DS did.

That extra $20-$30 on hardware can allow for a lot more breathing room with RAM, GPU power, battery size, screen quality, etc.

Then maybe 8-12 months post-launch once the early adopters have bought theirs, then you drop the price to $199.99, by this time manufacturing costs should be dropping.

Also a 720p screen probably is actually cheaper than a 540p screen. No one really asks for qhd displays (540p), 720p displays are still mass produced at least at a decent clip. Don't assume better tech = more expensive all the time. If you're ordering weird exotic parts (like a LCD display with a resolution no one else but you ask for), you will pay more.