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Soundwave said:

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.

Its not only about cost of screen, screen with higher resolution requires stronger hardware, stronger hardware requires stronger battery, stronger hardware and stronger battery affects on higher price of device.