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Forums - Nintendo - Switch costs ~$257 to build and 30MM sold through 2018

zorg1000 on 04 April 2017
Slownenberg said:
I find it strange that some people are saying they hope for a price cut soon (this year). It came out a month ago!!!! It is sold out everywhere. A price cut this year would be the number one stupidest thing Nintendo could do. A price cut will come when sales start to become lackluster. I'd guess price cut to $250 in 2019, maaaaaybe for holidays 2018 but I suspect the Switch will sell very well so I very much doubt they'll need to sales boost from a price cut until 2019. I also don't get the people saying it is too expensive, which are the same people, I think $300 is a perfect price for it, and judging by this analysis of the cost to make the Switch it would seem it is a perfect price from a cost perspective for Nintendo as well. It is a very powerful handheld system, that doubles as a moderately powerful console, with touch screen, with controllers that can be formed to be 1 or 2 build in controllers. Welllll worth $300.

They are marketing it as a console right now because they are looking to pick up console sales for it. It is a cheap new console right now but is expensive for a handheld. In a couple years once they get the price under $250 they'll probably start to market it more as a handheld to get the tens of millions of 3DS users that haven't yet switched over to start to switch over. Anyways, the cost makes sense given that it is a super powered handheld with two motion controllers, a touch screen, and a dock to make it a console.

Ya if Switch continues to do well than a price cut probably wont happen, instead i suspect we will see them bundle a game or two sometime this fall to add value for prospective consumers this holiday.

I could also see some retailers doing their own bundles or temporary sales for the holidays but not an official price cut from Nintendo.



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PAOerfulone on 04 April 2017

If Nintendo is making a profit (albeit, barely) off the system, and it's selling like hotcakes, than I don't see a price cut happening any time soon, certainly not by the end of this year. I think we'll more likely see Splatoon 2 and Super Mario Odyssey bundles at $330-350 than get a price cut.



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Raven on 04 April 2017

Well look at that, not as criminally overpriced as some people have been claiming lately.



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Normchacho on 04 April 2017
Miguel_Zorro said:
cycycychris said:

Even $30 or $20 is a pretty terrible margin which is around what I would set this around (but I have no idea, I've only worked in grocery and know the margins on most things there). I wouldn't say there really any profit at buying with only $20 to play aroudn with. I've never heard about console prices, but from what I heard from a friend at gamestop, they only make $3 or $4 on new games. I knew games were always low margin.

That $3-$4 figure matches what she tells me they make on new games.  She says for consoles they actually lose like $20.

I'm sure it depends on the retailer...but that's not my experience. I work at Target and we make like...$15ish dollars on a new game and 5-10% on a new console.

Hell, We get PSVRs for $365 last it I checked.

It's the same thing with TVs. We make some money on them, but way more money on accessories.



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Normchacho on 04 April 2017
RavenXtra said:
Well look at that, not as criminally overpriced as some people have been claiming lately.

Margin and value aren't directly linked.

A cup of coffee that costs $.40 to make can easily be worth a few dollars, but the PS3 which cost like $800 to make wasn't worth the $600 they were asking for it.

 

However, an item can be considered too expensive if the things it's made of are considered much cheaper than the end product. Which is the case of the Switch Dock.



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zorg1000 on 04 April 2017
RavenXtra said:
Well look at that, not as criminally overpriced as some people have been claiming lately.

talk of being overpriced should have ended when 3rd party developers were surprised that Nintendo was able to sell it at that price without taking a loss.



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

Normchacho on 04 April 2017
Miguel_Zorro said:
Normchacho said:

I'm sure it depends on the retailer...but that's not my experience. I work at Target and we make like...$15ish dollars on a new game and 5-10% on a new console.

Hell, We get PSVRs for $365 last it I checked.

It's the same thing with TVs. We make some money on them, but way more money on accessories.

Yes, I'm sure Target would have some good buying power.

The TV thing is interesting.  For the last two TVs that I bought, I know that the price I paid was below the retailer's cost.  They're counting on people buying TV stands or HDMI cables.

Yeah, it's not much. For instance we sell a particular TV (the last one I've actually seen the cost on) for $1199 and we make like $80 on it. Now, if a TV is on sale then the store is almost 100% losing money on that TV. The goal there is just to get people into the store and shopping.



Bet with Adamblaziken:

I bet that on launch the Nintendo Switch will have no built in in-game voice chat. He bets that it will. The winner gets six months of avatar control over the other user.

Lawlight on 04 April 2017
zorg1000 said:
Lawlight said:

PS4 didn't have a worldwide launch. 25 Nov 2015 is less than 2 years for PAL and JP.

lol you're really going to argue over 4 days for PAL regions? Its over 2 years for America (by 10 days) so lets just split the difference and say 2 years for America/PAL regions, sound fair?

As for Japan, ya it launched 3 months later but adding those extra 3 months only adds up another 400k so the point still stands, if Switch hits 30 million by the end of 2018 it would do so faster than PS4 did.

Yes, I'm going to argue for facts. And 400k is more than an NA month.



zorg1000 on 05 April 2017
Lawlight said:
zorg1000 said:

lol you're really going to argue over 4 days for PAL regions? Its over 2 years for America (by 10 days) so lets just split the difference and say 2 years for America/PAL regions, sound fair?

As for Japan, ya it launched 3 months later but adding those extra 3 months only adds up another 400k so the point still stands, if Switch hits 30 million by the end of 2018 it would do so faster than PS4 did.

Yes, I'm going to argue for facts. And 400k is more than an NA month.

Only the facts that help yours look good? Because you didnt point out that Nov 25 was over 2 years in NA.

What does 400k being more than an NA month have to do with anything?

Like I said, the point still stands that if Switch does sell 30 million by the end of 2018 (22 months on market) that would still be faster than it took PS4.

As of Oct 4, 2015 (slightly over 22 months) PS4 had sold 25.7 million outside of Japan.

At the end of 2015 (slightly over than 22 months) PS4 had sold 2.3 million in Japan.

Thats 28 million after slighty over 22 months in each region.



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

SuperNova on 05 April 2017
Einsam_Delphin said:
SuperNova said:

if this figure is true, wich I have my doubts about since Nintendo said they are making profit on the system, it certainly explains why 12switch wasn't a pack-in.

Is there a source for this? I can't find where Nintendo directly confirmed that.

Well eitherway, yeah probably no price cut this year, but bundles are still very much likely to happen this holiday.

There you go. Kimishima directly stated they would be making a profit on Switch prior to launch (We even had an article here on VGchartz about it if I remember correctly) and Reggie said something to the effect as well.

https://venturebeat.com/2016/10/26/nintendo-wont-sell-switch-at-a-loss-plans-to-ship-2-million-units-in-march/

The_Yoda said:
SuperNova said:

if this figure is true, wich I have my doubts about since Nintendo said they are making profit on the system, it certainly explains why 12switch wasn't a pack-in.

Very true, still I find it hard to believe they put damn near as much into 1-2switch as they did BOTW which is only $10 more with a 6 year development cycle..


Although I haven't played it 1-2 switch shouldn't be more than $30 retail and if they really wanted to showcase the system they should have sold it at $20. That of course would conflict with their software value philosophy .

Both true.

Not completely sure I remember correctly, but I did some research into Nintendos development teams a while back and I think i came to the conclusion that 1-2 switch had roughly a 2-year development cycle. They could, and should have sold it at 30$, but It's selling pretty well anyways, so jokes on us I guess.