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View Full Version : How much is MS losing on individual console sales and why?



OC Noob
09-06-2003, 04:00 PM
The components are mostly integrated (just learned that from another member) and its not like they are paying anywhere close to what a consumer pays for PC hardware. I can't imaging that a unit could cost that much over $200 from start to sitting on a store shelf.

The extra 128 mb of ram people pay an extra $100 for on r9800 pros and 5900 ultras only cost ATI and NVidia $7-14 so these guys aren't paying anywhere close to what we pay so don't add up the cost of making your personal computer please.

Diddy
09-06-2003, 04:43 PM
So WTF ARE YOU ASKING AND WHY DO YOU CARE!?!?!?!


Microsoft is a multi billion dollar company and of course they buy their parts in bulk so it is much cheaper thant what the average PC consumer pays.

So the Xbox could cost 10 dollars to make(Hypothetical) and they sell it for close to 400 dollars on release. Why? Because money makes the world go 'round and Bill Gates didnt get rich by selling things CHEAP!


Other than that, I really dont know what youre asking.

Tim
09-06-2003, 06:16 PM
Originally posted by OC Noob
The components are mostly integrated (just learned that from another member) and its not like they are paying anywhere close to what a consumer pays for PC hardware. I can't imaging that a unit could cost that much over $200 from start to sitting on a store shelf.

The extra 128 mb of ram people pay an extra $100 for on r9800 pros and 5900 ultras only cost ATI and NVidia $7-14 so these guys aren't paying anywhere close to what we pay so don't add up the cost of making your personal computer please.

Of course, there is no way of knowing exactly how much they are making or losing per box. That is sensitive information.

But, I do think when you hear blanket statements that MS is losing money on every box, there is a lot more involved then the individual components. There is man power for assembly and reasearch and developement that get allocated to each box made.

I agree with diddy. Bill Gates know what he is doing. Just trust us on that. The company is making money on the Xbox division, once the initial start up costs are regained, they will be home free!

blackdeath
09-06-2003, 09:20 PM
MS loses money on the box itself, but more than makes up for it on the games (they get a royalty from each game sold) and for all the peripherals etc...don't worry about MS. they're doing fine w/ Xbox.

Chaotic
09-06-2003, 10:40 PM
there loosing $100 dollars per xbox, it was more before but they have started to make up for it.

jabrre
09-07-2003, 12:44 AM
Here we go again with the concern about XBOX. Look, the BOX is doing so much better than what was expected in 2001. Nobody in their wildest dreams ever thought that Microsoft would even be ahead of Nintendo in the game, but they are. Just play the games and be happy. Life is too short to be worried about how much money Microsoft is making or losing. They will be around for generations to come.

Voodoo_Vince
09-07-2003, 08:02 PM
It's posts like this that my Post count is so Low, a Guy makes a statement and everybody takes it the wrong way, he was just wondering about it, not saying Xbox is Dying or anything, but I guess the average person on here is 12 so I can't expect much in the Social emotions level

Highlite23
09-07-2003, 09:31 PM
OC, Welcome to the site and my appologies for some responses. Some of us forget that not EVERYONE got their XBOX over a year ago and know everything thats been going on.

Or know how to use the search feature on this site (Oddly enough some not-so-new members don't know how either)

So in answer to your question look at the the comment by "Chaoticmage".

And for you others.............you know who you are, take a pill.:p

OC Noob
09-08-2003, 12:14 AM
For the quality responses, thank you. I read an article were a Nintendo guy was pretty much talking **** about the XBox because it was losing money and I wanted to get a rough figure and maybe some reasoning. When I said from start to sitting on the shelf I did mean all the costs like developement and labor and I'm sure that $100 figure includes all that. Thank you for the help.


As for some of the select few especially the genius first reply its really very simple. I asked why they are losing money on each unit so I can speak knowledgably about the subject the next time some PS2 or GC fanboy starts screaming about XBox losing money. Personally, I don't think they are losing all that much (on unit sales alone). Maybe someone has seen some leaked info or some educated speculation they might share.

The statement about part costs was to avoid the typical "I paid $1500 for my PC and its basically a PC" comment from people who don't realise how cheap the components they pay an extra $100 for really are.

If you didn't understand that try reading the title and the post again.