We’ve known for some time that Nintendo is selling the Wii U at a loss, which is why the company refuses to offer a price cut similarly to the 3DS when it launched. But just how much of a loss is Nintendo making on the Wii U?
I could make an estimate like this, but CNN's price bases are likely aiming for the lowest cost over everything which is more than likely lower than what it actually costs. Especially the controller and the gpu. They also aren't taking into account the actual labor, manufacturing cost, shipping, and the retailers cut of the profit. Well, either way, people who don't like Nintendo are bound to eat this up and spin it every way they can as %100, unadulterated, confirmed fact like they did with Digital Foundrie's GPU guess that was proven wrong hours later by the very people they claimed to have got it from. Honestly, fact doesn't matter to most modern gamers. They will believe what they like the most in the end and journalist will say whatever they think will get the most hits to their site.
Blast Processing all over again. Sega does what Nintendon't What a crock.. :P
Uhmm do you realize the Wii U is manufatured in China right? If so, do you know how China economy works?
@ lilbro ;) "CNN Money did a tear down of all the parts and found that for the basic white Wii U, the total cost comes in at $228. That’s about $70 less than the $299 suggested retail price" Meh, I still don't understand how Nintendo could only afford to make a NEW console who's value worth is that of merely $228 after coming off the success of the Wii. One would think they would heavily invest in their new hardware but, sadly thats not the case here. ;)
So far all the money Nintendo has made from the Wii success has been lost in the last couple of years. Nintendo beats toa different drum than the others.
@Mustang300C2012 not all of it though actually even with how hard the 3ds was tanking Nitendo still had a considerable nest egg and then the 3ds started turning a profit so yeah they have the money
Actually, retailers don't make a dime off of console hardware... your other points are very true though. Also, research costs money. There is also the fact of the combined GPU and CPU chip. You have the manufacturing of this specialized chip, but you also have the time and money it costs to get two completely separate companies to work on them/it with you to come together and combine the chips.
I think that's a bit of an exaggeration. I'm sure retailers make some sort of percentage, just probably not a very high one. As for the chip, I know it's a modified model, so it probably costs extra to get it down to unique specifications. Interesting to think about, actually, especially when you consider how other consoles are manufactured.
@ PopRocks359 Okay, okay... they make what, between $5 and $15 per console sold. THat's basically nothing considering they make that per $60 GAME.
Who watches CNN?
There's obviously a couple people who have the hots for Nancy Grace.
Soledad O'Brian.... I love intelligent women...
Soledad O'Brien got fired :( she is pretty... and intelligent. I still prefer CNN to most American news networks, but they have gone down hill. The video at the link was kinda informative, even if it was all estimates.
Retaliation is the biggest form of immaturity. That is what i got from the Need For Speed comment on this article. To quote this proud Nintendo fan NEED FOR SPEED IS AMAZING!!!! . PS3 and 360 GO SIT IN THE CORNER , YOU'RE OLD AND YOU SHOULD FEEL BAD ABOUT YOURSELVES. I wish i had Hecatonchires hands to faceplam myself after reading that.
Doesn't sound like something any Nintendo fan I know would say. Sounds more like something a person who was trying to make fun of Nintendo fans would say to draw anger towards Nintendo fans.
Will you REALLY deny ever seeing extremist Nintendo fanboys? Every console manufacturer has its good fair share.
@TongkatAli Don't blame the many over the actions of the few. Every console maker has their crazies. Nintendo is no different from Sony and Microsoft in this regard.
Nintendo we all know has a certain philosophy and smart consumers dont buy into their bs. Their philosophy is sell the cheapest hardware possible and maximize profit because in their mind as long as they pump out Mario, Zelda and so forth the money will come. But im happy to see its screwing them over now.
They did the same bs with the 3ds, they inflated the cost by like a 100 and sold it for what like 300? then when vita came out they lowered the price because they could afford too and still make a profit. Its sad how they swindle ppl and talk up their consoles. At least with the 3ds they have some good software ill give them that much!
You know that's how business's work, right? You sell a product for more than it cost to make. For example, if I opened up a restaurant, it might cost me $1 to make a certain dish. I'll sell it for $10. But why? Well, for one, I need to make money off of a product. I can't very well be giving things away, and if I break even even that's no good either. 2nd, besides the simple profit, there is a lot of overhead. For example, shipping the ingredients, paying for cooks, paying for servers, paying for people to keep the place looking nice, busboys, and then there's the rent for the place. All in all, I might only be making $5 off of each dish when everything is said and through. The point is, I made some money. If I make enough money, I can expand, or not, or invest. The point is, that it is stupid for a business not to sell at a profit. That's why Nintendo is much more profitable of a company overall than both Sony's and Microsoft's gaming division.
But the point is stop telling people you're selling at a loss! The restaurant example you gave, you don't hear the owner saying he's selling at a loss! he makes adjustment accordingly. As far as Sony and Microsoft are concerned they both were selling for a loss out the gate! Sony moreso than Microsoft.
I don't think the've said that for a while though.
1) Um. Those consumers are not that smart. Just a bunch of idiots with more money to throw around than the average consumer. 2) And what self-respecting business sell their products at less than what it costed them to make? I'm even happier to see Sony's business model blow up in their faces. 3) Um. The Vita's original price was exactly the same as the 3DS's original price. And it was at a time when Sony's own problems were rearing its ugly head. It was only the Japan division that cut the price in hopes to boost sales. They couldn't afford to drop the price which is why they held onto the $250 price tag for so long.
Oh my god! A company is selling a product for profit! Shame on them! That's not how the world works! /s
"A company is selling a product for profit" i don.t think that is the problem, Reggie lying about it is? Edit: Reggie is a PR guy and also taking R&D into account, which means he is not lying in my eyes Edit2: wonder how many unit sales are needed before R&D is paid for then the $70 is profit
Honestly, I don't really care, it's a good product and it's priced fairly(the deluxe one anyway). It just needs more games. Fortunately Monster Hunter just came out to save the day.
The wii u was designed in like 2011 or something, so maybe they used more expensive parts?... whatevs
Designed yes, manufactured no. Regardless, they did a breakdown of the cost of the parts, not the costs of assembling them, transporting them, etc so I'm certain Nintendo actually is losing money like they said so themselves.
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