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Forums - Nintendo Discussion - Nintendo spend $527M in R&D in the FY'15 according to Technavio

elektranine said:
jason1637 said:

How much a company spends on a console doesnt really determine how successful it will be.

Look at the wii.

Also we don't know how much the spent on the NX. We only know that 627m was spent on r&d in 2015.

Yes let's look at the Wii, let's look at the Wii:

The was released and sold well for a period of time and then didn't sell nearly as well. There was a mass hysteria surrounding the Wii propelled by the media, such as CNN, Fox, ABC, NBC, etc, promoting it as a "must have" device. Basically it was cool to own one. Many non-gamers bought this device just because their friends had ones. Nintendo reported alarming statistics such as less than 40% of Wiis were ever connected to the internet and very low software attach rates.

This obviously didn't happen with the Wii U and almost certainly won't happen with the NX either. Besides I don't think anybody wants another Wii with its low attach rates it failed to attract much hardcore games from developers and what was on there were poorly designed motion controls ala 3rd party shovelware.

 

Besides the main premise of this thread is to discuss the R&D costs of the NX. Many say the NX is supposed to be more powerful than the PS4 but with such low R&D Costa it likely will not. See my above post on how people are overstating Nintendo's true console R&D costs.

Wii has an attach ratio of 9.5, what are you talking about?



When the herd loses its way, the shepard must kill the bull that leads them astray.

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elektranine said:
jason1637 said:

How much a company spends on a console doesnt really determine how successful it will be.

Look at the wii.

Also we don't know how much the spent on the NX. We only know that 627m was spent on r&d in 2015.

Yes let's look at the Wii, let's look at the Wii:

The was released and sold well for a period of time and then didn't sell nearly as well. There was a mass hysteria surrounding the Wii propelled by the media, such as CNN, Fox, ABC, NBC, etc, promoting it as a "must have" device. Basically it was cool to own one. Many non-gamers bought this device just because their friends had ones. Nintendo reported alarming statistics such as less than 40% of Wiis were ever connected to the internet and very low software attach rates.

This obviously didn't happen with the Wii U and almost certainly won't happen with the NX either. Besides I don't think anybody wants another Wii with its low attach rates it failed to attract much hardcore games from developers and what was on there were poorly designed motion controls ala 3rd party shovelware.

 

Besides the main premise of this thread is to discuss the R&D costs of the NX. Many say the NX is supposed to be more powerful than the PS4 but with such low R&D Costa it likely will not. See my above post on how people are overstating Nintendo's true console R&D costs.

We still don't know if this is entirely on NX. Plus, as ZhugeEX said, we should wait till we know something about the 2016 fiscal year since this is potentially a big year for Nintendo in general. And do we disregard their handhelds in R&D?



elektranine said:
jason1637 said:

How much a company spends on a console doesnt really determine how successful it will be.

Look at the wii.

Also we don't know how much the spent on the NX. We only know that 627m was spent on r&d in 2015.

Yes let's look at the Wii, let's look at the Wii:

The was released and sold well for a period of time and then didn't sell nearly as well. There was a mass hysteria surrounding the Wii propelled by the media, such as CNN, Fox, ABC, NBC, etc, promoting it as a "must have" device. Basically it was cool to own one. Many non-gamers bought this device just because their friends had ones. Nintendo reported alarming statistics such as less than 40% of Wiis were ever connected to the internet and very low software attach rates.

This obviously didn't happen with the Wii U and almost certainly won't happen with the NX either. Besides I don't think anybody wants another Wii with its low attach rates it failed to attract much hardcore games from developers and what was on there were poorly designed motion controls ala 3rd party shovelware.

 

Besides the main premise of this thread is to discuss the R&D costs of the NX. Many say the NX is supposed to be more powerful than the PS4 but with such low R&D Costa it likely will not. See my above post on how people are overstating Nintendo's true console R&D costs.

Dude the Wiis attach rate is actually higjet than the wii u.

Also the ps4 came out in 2013. Im sure Nintendo doesnt need to spend that much to make a console more powerful.



Probably just NX related investments or something.



"Just for comparison Uncharted 4 was 20x bigger than Splatoon 2. This shows the huge difference between Sony's first-party games and Nintendo's first-party games."

elektranine said:
Meanwhile PlayStation spends billions.
Just the APU was over 3 billion to develop.
If the numbers are true for Nintendo then I wouldn't expect the NX to be radically different than their previous console attempts. Sony spent over 6 billion on the PS4 project so half a billion is really a drop in the bucket.
So as I predicted before the NX is only going to be a moderate upgrade over the Wii U just like the Wii U - Wii upgrade before it.

Eh... what?

I'm not sure how the APU could have cost Sony 3 billion dollars to develop.  First off, it's not a Sony chip.  It's made by AMD. Sony may have kicked in some money, 3 billion seems way over the top.   Secondly, I see no reason for such an insane budget.  It's not a particularly customized chip.  I actually wouldn't be surprised if the Wii U chip, which is highly customized, cost more.  For a point of reference, the development budget for the cell processor, a proprietary processor that was way ahead of its time, was reported by two of its developers to be 400 million.  There is no way that a fairly standard non proprietary chip would cost such a high amount.

http://www.gamasutra.com/view/news/112644/Report_Sonys_Cell_Dev_Cost_400_Million_Aided_Microsoft_Tech.php

And IF Sony actually paid that much, then they are a terribly terribly mismanaged company.  From 2001-2005 (the golden years of the PS3) Sony made just about 2.5 billion in profit from its gaming division.  Sony would have to make more than double that on the PS4 to just break even.  In its best years, their gaming division did about a billion, usually closer to half a billion in the years where they didn't post losses.  Even if Sony matched their peak years for the next 6 years, they would barely turn a profit on this thing.


So, do you have any sources for any of this?  Because those figures seem bat shit crazy.

Edit:  For both FY 2014 and 2015, Sony spent a bit over 4.5 billion on R&D.  That is not the gaming division.  That is for everything they do in the company.  Very unlikely that the PS4 accounted for (if we assume a four year development time with your 6 billion figure) about 1/3 of their R&D budget for 4 years.



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jason1637 said:
elektranine said:

Yes let's look at the Wii, let's look at the Wii:

The was released and sold well for a period of time and then didn't sell nearly as well. There was a mass hysteria surrounding the Wii propelled by the media, such as CNN, Fox, ABC, NBC, etc, promoting it as a "must have" device. Basically it was cool to own one. Many non-gamers bought this device just because their friends had ones. Nintendo reported alarming statistics such as less than 40% of Wiis were ever connected to the internet and very low software attach rates.

This obviously didn't happen with the Wii U and almost certainly won't happen with the NX either. Besides I don't think anybody wants another Wii with its low attach rates it failed to attract much hardcore games from developers and what was on there were poorly designed motion controls ala 3rd party shovelware.

 

Besides the main premise of this thread is to discuss the R&D costs of the NX. Many say the NX is supposed to be more powerful than the PS4 but with such low R&D Costa it likely will not. See my above post on how people are overstating Nintendo's true console R&D costs.

Dude the Wiis attach rate is actually higjet than the wii u.

Also the ps4 came out in 2013. Im sure Nintendo doesnt need to spend that much to make a console more powerful.

Ah yes the oft repeated yet incorrect theory that Nintendo can just stick off the shelf parts in the NX and be more powerful.

Ask yourself this, why 29 months later can you still not buy an APU more powerful than the PS4's APU?

The PS4's APU is a fully custom chip the result of years of R&D by SCE's engineers and AMD's engineers with billions in R&D costs all fronted by SCE. The PS4 APU cost less than $50 at launch to manufacture yet AMD still has not released a APU coming even remotely close to that APU in terms of power.

Surely AMD would have released that chip on PC had they been legally able to do so. It would had a pretty capable chip to go after PC gamers with and since its cheap to make they could have priced it at $100-$150 and still made a killing. However that never happened and never will happen.

The custom chip that SCE and AMD co-developed is the property of SCE and they have the exclusive rights over it. AMD can't use any knowledge from the development of the PS4 APU in any other projects. They are legally bound by contract and NDA. That's why we still do not know the PS4's CPU clock speed and there are still key technologies implemented in the PS4 APU that are missing from AMD's retail APUs and GPUs. SCE went to AMD and contracted them to provide a reference design and to work with them to heavily customize that tech. 

This is why Nintendo has to pay big bucks to beat the PS4. They have to go to AMD and pay the R&D costs to develop a new better APU, as AMD legally cannot use any knowledge they learned from SCE. Or they have to go with a discreete CPU/GPU combo but that would still be constly and drastically increase the cost of the NX console. The thrid option would be to pick an existing retail APU and customize it to their liking but that would still be less powerful the the PS4 but maybe more than the xbone.



JWeinCom said:
elektranine said:
Meanwhile PlayStation spends billions.
Just the APU was over 3 billion to develop.
If the numbers are true for Nintendo then I wouldn't expect the NX to be radically different than their previous console attempts. Sony spent over 6 billion on the PS4 project so half a billion is really a drop in the bucket.
So as I predicted before the NX is only going to be a moderate upgrade over the Wii U just like the Wii U - Wii upgrade before it.

Eh... what?

I'm not sure how the APU could have cost Sony 3 billion dollars to develop.  First off, it's not a Sony chip.  It's made by AMD. Sony may have kicked in some money, 3 billion seems way over the top.   Secondly, I see no reason for such an insane budget.  It's not a particularly customized chip.  I actually wouldn't be surprised if the Wii U chip, which is highly customized, cost more.  For a point of reference, the development budget for the cell processor, a proprietary processor that was way ahead of its time, was reported by two of its developers to be 400 million.  There is no way that a fairly standard non proprietary chip would cost such a high amount.

http://www.gamasutra.com/view/news/112644/Report_Sonys_Cell_Dev_Cost_400_Million_Aided_Microsoft_Tech.php

And IF Sony actually paid that much, then they are a terribly terribly mismanaged company.  From 2001-2005 (the golden years of the PS3) Sony made just about 2.5 billion in profit from its gaming division.  Sony would have to make more than double that on the PS4 to just break even.  In its best years, their gaming division did about a billion, usually closer to half a billion in the years where they didn't post losses.  Even if Sony matched their peak years for the next 6 years, they would barely turn a profit on this thing.


So, do you have any sources for any of this?  Because those figures seem bat shit crazy.

Edit:  For both FY 2014 and 2015, Sony spent a bit over 4.5 billion on R&D.  That is not the gaming division.  That is for everything they do in the company.  Very unlikely that the PS4 accounted for (if we assume a four year development time with your 6 billion figure) about 1/3 of their R&D budget for 4 years.

What is the source fothis graph?   I don t think it is acurate as the profit loss for Sony and MSFT gaming divsions were not "broken out" during these years-  This graph has ben around a while and seems to be taken as fact but there is no way it could be and i doubt the Sony or MSFT part of it is remotley acurate



Dunban67 said:
JWeinCom said:

Eh... what?

I'm not sure how the APU could have cost Sony 3 billion dollars to develop.  First off, it's not a Sony chip.  It's made by AMD. Sony may have kicked in some money, 3 billion seems way over the top.   Secondly, I see no reason for such an insane budget.  It's not a particularly customized chip.  I actually wouldn't be surprised if the Wii U chip, which is highly customized, cost more.  For a point of reference, the development budget for the cell processor, a proprietary processor that was way ahead of its time, was reported by two of its developers to be 400 million.  There is no way that a fairly standard non proprietary chip would cost such a high amount.

http://www.gamasutra.com/view/news/112644/Report_Sonys_Cell_Dev_Cost_400_Million_Aided_Microsoft_Tech.php

And IF Sony actually paid that much, then they are a terribly terribly mismanaged company.  From 2001-2005 (the golden years of the PS3) Sony made just about 2.5 billion in profit from its gaming division.  Sony would have to make more than double that on the PS4 to just break even.  In its best years, their gaming division did about a billion, usually closer to half a billion in the years where they didn't post losses.  Even if Sony matched their peak years for the next 6 years, they would barely turn a profit on this thing.


So, do you have any sources for any of this?  Because those figures seem bat shit crazy.

Edit:  For both FY 2014 and 2015, Sony spent a bit over 4.5 billion on R&D.  That is not the gaming division.  That is for everything they do in the company.  Very unlikely that the PS4 accounted for (if we assume a four year development time with your 6 billion figure) about 1/3 of their R&D budget for 4 years.

What is the source fothis graph?   I don t think it is acurate as the profit loss for Sony and MSFT gaming divsions were not "broken out" during these years-  This graph has ben around a while and seems to be taken as fact but there is no way it could be and i doubt the Sony or MSFT part of it is remotley acurate

I do believe that I've seen this one backed up by financial figures... but you can ignore the chart if you want.  Instead, we can use recent numbers.

In 2014 Sony lost 78 million http://www.gamesindustry.biz/articles/2014-05-14-sonys-game-division-reports-full-year-loss

In 2015 they made 400 million  http://www.digitaltrends.com/gaming/sony-posts-record-5-74-bil-annual-loss-playstation-division-reports-2-8-bil-loss/

This is accounting for the profits made from PS3 and Vita as well.  Going by the 6 billion figure, they'd have about 5.6 billion dollars until the break even point, and more to account for marketing.  It's kind of unlikely that will happen.



elektranine said:
jason1637 said:

Dude the Wiis attach rate is actually higjet than the wii u.

Also the ps4 came out in 2013. Im sure Nintendo doesnt need to spend that much to make a console more powerful.

Ah yes the oft repeated yet incorrect theory that Nintendo can just stick off the shelf parts in the NX and be more powerful.

Ask yourself this, why 29 months later can you still not buy an APU more powerful than the PS4's APU?

The PS4's APU is a fully custom chip the result of years of R&D by SCE's engineers and AMD's engineers with billions in R&D costs all fronted by SCE. The PS4 APU cost less than $50 at launch to manufacture yet AMD still has not released a APU coming even remotely close to that APU in terms of power.

Surely AMD would have released that chip on PC had they been legally able to do so. It would had a pretty capable chip to go after PC gamers with and since its cheap to make they could have priced it at $100-$150 and still made a killing. However that never happened and never will happen.

The custom chip that SCE and AMD co-developed is the property of SCE and they have the exclusive rights over it. AMD can't use any knowledge from the development of the PS4 APU in any other projects. They are legally bound by contract and NDA. That's why we still do not know the PS4's CPU clock speed and there are still key technologies implemented in the PS4 APU that are missing from AMD's retail APUs and GPUs. SCE went to AMD and contracted them to provide a reference design and to work with them to heavily customize that tech. 

This is why Nintendo has to pay big bucks to beat the PS4. They have to go to AMD and pay the R&D costs to develop a new better APU, as AMD legally cannot use any knowledge they learned from SCE. Or they have to go with a discreete CPU/GPU combo but that would still be constly and drastically increase the cost of the NX console. The thrid option would be to pick an existing retail APU and customize it to their liking but that would still be less powerful the the PS4 but maybe more than the xbone.

It's a semi custon APU and it's based mainly on existing AMD technology

In the case of the PS4, we leveraged the building blocks of our 2013 product roadmap – the same technologies you find in the latest AMD APUs powering PCs, ultrathin notebooks and tablets – to create a solution that incorporates our upcoming, low-power AMD "Jaguar" CPU cores with next-generation AMD Radeon™ graphics delivering nearly 2 TFLOPS of compute performance!"

It's just not some magical proprietary hardware. It's a modified AMD APU.  Since it is, according to AMD, based on their existing technology, there doesn't seem to be a reason they couldn't make something similar for Nintendo.

They cannot sell that exact chip, but there are similar ones.  It's based on a mobile chipset, so it would be limited to gaming laptops really.  Even if they could sell the exact same APU, they likely wouldn't.  It was made specifically for consoles.  It is very heavy on the GPU part which becomes a bottleneck when you're running a bunch of different things as you often would on a PC.  It also includes a lot of elements that PC gamers would normally keep seperate.  The advantage of having a merged APU and CPU wouldn't appeal to desktop gamers who could buy more powerful CPU and GPUs seperately.

http://www.pcworld.idg.com.au/article/454508/amd_opens_up_about_playstation_4_custom_processor/



I don't think looking at what they spent just last year is a fair assessment of what they spend overall for R&D. Nintendo states that as soon as one console is released they start working on their next project. So my guess is that one needs to add up what they've spent from 2012 up until now for both the future of their handheld and home console (since it's all under one division now).