Edit: wow that ended up as a rant...sorry about long read :(

I think it will work the same for Sony and MS. Not sure what the difference will be?

The idea with a subscription is to gain long term customers and have a continuous revenue flow. MS made huge amounts of money from XBOX live subscription. Just think about how much money MS has made with all those Halo and COD players, who bought 360 at the very begining at a high price and have continued to pay for xbox live for the next 7 years! I would say on those particular customers MS has made back triple or quadruple the amount of money...not to mention online sales etc. I dont think MS even sold the 360 at a loss....(not sure about this though).

All that needs to happen here is make the console affordable upfront, lets say 199 - 299USD? And add on a bigger subscription fee that can recover costs much sooner. Obviously for this to be viable the manufacturer needs to offer additional services. In MS case they offer multiplayer as an additional cost. Sony needs to do the same as well and add additional services like gaikai, instant collection, psn plus etc. Gaikai is key here for Sony as it sets them apart from the rest.

Both companies would obviously need to look at the model and see how it will work for them as well as the consumer. I just see it as a win win across the board for both consumer and company. Provided that the offering and services are up to par. IMO this would not bleed money and Sony would make much more in a year or two's time.

By making money in the long term i dont mean that in the same way as the current pricing model. This is different from the current model in that the console is being sold at a loss upfront with no substantial plan to recover costs! The "plan" then is to make money on software. Yeah this works if you have some sort of monopoly on the industry but in the current situation its not feasable. Not to mention the ever increasing costs to make big budget games, and again the reluctance of consumers to spend insane amounts of money on what is seen entirely as a luxury. I mean shit....70$ for a new game wtf. No one is wnning from this situation except maybe activision and a few others big publishers. This is a major risk as sony are not sure whether those costs are even going to be made back.

Think about a guy who bought the ps3 when it first launched. 599$ for the consumer, a ~200 - 400$ loss for sony. The guy then only buys COD once a year of which sony is hardly making anything as the margins are so tight. Who wins here? Not the consumer he just bought a 599$ toy and a couple of games every now and then. Not sony, they just made a 400$ loss on a 1000$ toy. OKay yeah the makers of COD make money sure, but ONLY if production costs are covered which in itself is risky as millions will need to be sold.

Everything about the current model does not work. Its expensive for everybody involved and most of all  its completey inconvenient. I feel a new pricing model will  do wonders for the industry especially going into next gen as prices are boung to jump again.

We won't be able to accurately guess the mfg cost until we can disassemble it and find out exactly what is inside.

Precisely.

There are many things that, even though we know they are in the console, we don't know which kind of they are. For example we know that it has a total 2GB of RAM but, which kind of RAM? Etc.

And also remember that those 25k yen includes the profit margin for the stores, which we also ignore.

Profit margins for stores is a measly $2-to-$5 in the US so its almost nothing.

Yeah, stores make more profit from games.

But we still ignore if Nintendo is making a profit from the basic model or not, and if there is a profit, they won't tell us how much it is. And there are also the packaging and shipping costs that will be different from WiiU to PS4 as the consoles/boxes won't have the same size or weight.

So once all is said and done, we may end with a rough guess of the cost of the materials, but there are many other costs that we will never know.