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[JRPGfan]

bonzobanana said:

JRPGfan said:

Nintendo didnt use any R&D on the chip....
and they got them dirt cheap from nvidia (that had a huge stockpile laying around they couldnt sell).

It bugs me Nintendo decided to go for 299$ price point.
However if their still selling them faster than they can make them, its all good for them.

Guys dont be suckers though, if you wait like 6months time Im pretty sure you ll see them do a 50-100$ price cut.

Did they have a huge stockpile, not read that anywhere. Also do Nvidia do anything cheap, they are one of the most profiteering companies out there who often price themselves out of contracts and treat their business partner's badly. 

Maybe your right though, Nintendo get their first batch on the cheap and then Nvidia ramp up the price when they can deliver a 16nm chip.

Lets say you make a chip, and assume you can sell it for x amount of $.

You make a couple of million of them (x$ times millions), hopeing to score some Tablet contract...... it falls through.

Now you have millions of these chips laying around in a warehouse.

No one wanted to buy them, so nvidia started makeing Shield TV, shield handheld, ect trying to not lose so much on the chips.

But its not selling well.... so you still have millions left.

Nintendo offers to buy them from nvidia, but knows nvidia cant really sell from a position of strength.

Its sell it to nintendo for dirt cheap, or risk never getting anything for them.

Nvidia choose to sell them dirt cheap.

Semiaccurate wrote a article about it, where they heard it from a inside guy, Nintendo got a really good deal on them.

 

"Nintendo get their first batch on the cheap and then Nvidia ramp up the price when they can deliver a 16nm chip."

Yeah I wouldnt be surprised if its something like that.

Nvidia takes a huge loss on the first batches of chips,  and hopes the switch goes on to sell like the "Wii" did, and think "we ll make profits down the line".