| Fei-Hung said: I was thinking this will be priced at $399-450 or $450-499, but looking at what's been said about the cost of the card alone not including everything else needed that goes into a console, i can see this being between $699-750. The cost of the chip alone might be $300. Add a TB hard drive, Bluetooth, wireless, Ram, audio chip, fan, casing, power unit, controller, logistics and retailer profit margin, this won't be cheap. |
Remember that's the retail for the card. While graphics cards are sold at a profit, game consoles are generally sold at cost, if not a loss. So Microsoft will be paying wholesale and passing it on to consumers that way. As for "retailer profit margin", I used to work in the games industry and there's little to no profit margin on the game consoles themselves. That's been the way since Nintendo pioneered the "razor, razorblade" model starting in the mid-80s. The consoles are sold by the manufacturer and the store nearly at cost, with everyone up and down the line hoping to sell games and accessories to make up for foregone profit on the console. If you adjust the pre-NES game consoles for inflation you'll discover they were amazingly expensive, because those old consoles *were* sold at a mark-up by the manufacturer, and then by the store who marked it up further. Last I checked, a Mattel Intellivision (circa 1980) would cost over $1200 at launch in today's dollars! It's probably more than that now.
Be suspicious of console system tear-downs too, as they are only guessing at what console manufacturers actually pay for the components.
