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View Full Version : Found a good article on cost of boxes....

SamuraiCatJB
07-01-2005, 02:22 PM
http://www.xbitlabs.com/news/multimedia/display/20050629231007.html

The subject has come up on multiple threads, wether arguing over who will loose more money, or how powerful the box is. This talks about the habit of loosing money in the first year to make it back in the 2nd year and gives good examples. And it is short too. :)
Homie S
07-06-2005, 03:35 AM
Yea, I read a few articles like this, Ken Kurtagi (sp?) said that very thing about losing money in the first year, and then earning it back afterwards. Of course, this came up because there are rumors that PS3 will be at a ~400$ target price. And even then they will be losing money on the first year. Just a rumor though. After all, the original Playstation and PS2 were at high markup for a time, so I'm not all that surprised.
Ezikial Anta
07-06-2005, 10:58 AM
Found a good article on I just got my drivers license!
Crap, is that off topic? :P
This was an interesting read, I never actually thought that game companies lost any money on the systems... Nintendo is the only one (Now) that makes money on systems, correct?
Karim
07-06-2005, 12:02 PM
I still want a PS3 more than I want an X360. The only thing that can make me buy an X360 right away is an announcement that Rare will make Killer Instinct 3.
SamuraiCatJB
07-06-2005, 12:48 PM
Found a good article on I just got my drivers license!
Crap, is that off topic? :P
This was an interesting read, I never actually thought that game companies lost any money on the systems... Nintendo is the only one (Now) that makes money on systems, correct?

I believe they all make money on the current editions, PS2, Xbox, nintendo... but we are at the end of of the cycle. As I spoke before, they generally loose money on the main hardware unit for the first year, but make up the loss in games. If they can break even the first year, they make profit the second. Nintendo has been around long enough to scale R&D well into the company, so they have the best foundation to support further generations. Microsoft being the new kid on the block is still trying to make up for the all the R&D on the first box company-wise and they are starting on the second box. Eventually it too will scale into the company line though.