Wii Autopsy :manufacturing cost

[sabre2922]

http://www.gametab.com/news/766453/

Graphics chip: $29.60
CPU: $13.00
DRAM: $7.80
Optical disk drive: $31.00
Power supply: $11.30
Manufacturing cost: $19.50
Cost total: $158.30
Wholesale price: $195.99


"If these guys have done their sums right, Nintendo are making just under $40 profit on every Wii sold. At such an early stage of the consoles development, and with sales so healthy, that's good news for anyone at Nintendo that's involved in the counting, or spending, of money"

[crazyjackcsa]

Wow, that's useless! Doesn't cover any associated costs at all. Doesn't even cover the cost of manufacturing it. Or even all of the parts! What about the cables, the housing, the lights and switches? What about the people (or machines) that put it together? What about the R&D? The buildings that they are built and stored in?

Then you have to figure that Nintendo doesn't pay the same that you and I would, they would pay far far less for parts.

[TheRedEye]

Wow, that's useless! Doesn't cover any associated costs at all. Doesn't even cover the cost of manufacturing it. Or even all of the parts! What about the cables, the housing, the lights and switches? What about the people (or machines) that put it together? What about the R&D? The buildings that they are built and stored in?

Then you have to figure that Nintendo doesn't pay the same that you and I would, they would pay far far less for parts.

What he said, except the "people (or machines) that put it together" are probably covered in the manufacturing cost estimate.

Also, what about shipping? Shipping is a pretty big cost.

[XYXZYZ]

Also, doesn't advertising and marketing get factored into the price of the product?

[Alucard79]

Just glancing, it looks like the math is wrong there. $112.20 should be the total. which goes with the first sentence of the second paragraph in the article, "If these guys have done their sums right..."

[Anthony1]

I predicted a very long time ago, that it costs Nintendo roughly $185 to bring a Wii to market. Now, when I say bring a Wii to market, I mean to actually get it into the retail channel. There are lots of little costs that most people don't realize in bringing a product all the way into the actual retail channel. Most retailers are making about $12 profit on the Wii, and then if you do the math, Nintendo is profiting about $53 per Wii. I'm going to stick to my predictions.

[Poofta!]

well the numbers dont add up, but i think thats where all the misc costs come into play. i think those numbers are pretty accurate, there nothing all that revolutionary about the wii in the hi-tech sort of sense, its all pretty widespread hardware. and a new controller is around 60 bucks lol...

[KingCobra]

I'm sure it's much tighter than a 40 dollar profit, more like $20 when all is said and done.

[cyberfluxor]

Lets not forget research costs! What about that $3 coffee the engineer drank last year, did they factor that in?

Really, I understand the curriousity in how much profit the companies are making and that you're getting ripped off compared to doing it yourself (or maybe just seeing how well a company is doing for the new generation) but it does sometimes go overboard. Unless a Nintendo rep announces to the world the cost per unit for each region it's always going to be an estimate and innaccurante, although some may be close. If they are selling the units for $250 and are still afloat and there's not hint of them going belly up then expect more systems to roll out and additional games to come.

I'm not posting to point fingers or criticize anyone, just it's a hard debate and judge how much something costs for a huge corporation that gets massive discounts for bundle loads of circuits and to pick at each others pricing becomes a bit crazy. There's so many threads and articles all over the internet about the same debate on every system. It would however be nice to know how much time and cost goes into making a Wii game over a PS3 or Xbox360.

[Anthony1]

Lets not forget research costs! What about that $3 coffee the engineer drank last year, did they factor that in?

Really, I understand the curriousity in how much profit the companies are making and that you're getting ripped off compared to doing it yourself (or maybe just seeing how well a company is doing for the new generation) but it does sometimes go overboard. Unless a Nintendo rep announces to the world the cost per unit for each region it's always going to be an estimate and innaccurante, although some may be close. If they are selling the units for $250 and are still afloat and there's not hint of them going belly up then expect more systems to roll out and additional games to come.

I'm not posting to point fingers or criticize anyone, just it's a hard debate and judge how much something costs for a huge corporation that gets massive discounts for bundle loads of circuits and to pick at each others pricing becomes a bit crazy. There's so many threads and articles all over the internet about the same debate on every system. It would however be nice to know how much time and cost goes into making a Wii game over a PS3 or Xbox360.


The only reason that people are a bit suprised by this, is because normally companies take losses on new gaming hardware at launch. In fact, I would be hard pressed to think of a time when a company didn't take a loss on gaming hardware at launch. It's just the norm to take a loss and to "give away the razor to sell the blades". So when you find out that Nintendo is making somewhere between $30 and $60 off each Wii sold, it is a bit suprising. It kinda lets you know that the Wii is currently overpriced at $249.99, but you can't blame Nintendo for pricing it like that because they are flying off the shelves regardless. Once all the Xmas hype dies down, and the novelty wears off, and you can walk into any random Target and buy a Wii, sales will cool off rapidly, and Nintendo will be able to drop the price to $199.99. But again, I can't blame Nintendo for overcharging for the Wii, if they can get away with it, more power to them. They are obviously getting away with it, with great success, so how can you blame them?