PDA

View Full Version : $75 lost for each 360?


Bad_Boy
06-06-05, 06:08 PM
http://www.gamesindustry.biz/content_page.php?aid=9320

i do hope they charge that though, id definately buy a xbox360 for 300.

GlowStick
06-06-05, 06:16 PM
Sounds reasonable for the buying power Microsoft has. Raw material + labor.

vX
06-06-05, 06:31 PM
$75 lost per system $20 gained on hundreds of titles =)

Edge
06-06-05, 07:03 PM
Seems about right, on the Xbox they were losing around $100 per console sold at launch. It seems they definately want to stay competative, for a while there I was afraid they would be cutting costs by not including a harddrive and such.

AthlonXP1800
06-06-05, 10:54 PM
That not very good news for Microsoft, they still continue to lose money on Xbox since the launch in 2001. They celebrated the first ever profit of $150m in Jan 2005 helped by the big success of Halo 2 and they believed they are back on track making profit throughout the year but the next quarter saw the profit fell back into the red with $300m loss, that the same loss Microsoft lose every quarterly for the last 4 years since launch. When Xbox 360 will launch this year, Microsoft will had around $4.4bn loss total for every quarters and $350m profit a quarter 4 years on with Xbox. That too bad, Microsoft will do the same thing with Xbox 360 and probably will make a profit for a quarter around in 2009.

Ruined
06-06-05, 11:04 PM
http://www.gamesindustry.biz/content_page.php?aid=9320

i do hope they charge that though, id definately buy a xbox360 for 300.

better than the $175 they lost on each xbox1 :)

AthlonXP1800
06-06-05, 11:58 PM
better than the $175 they lost on each xbox1 :)

I thought it was $75 to $100 loss on each Xbox.

I read in other forums, many think the real cost Microsoft will lose on each Xbox 360 are $200 because it not mentioned many other manufacturers charges fee like TSMC and others. Microsoft probably will pay TSMC around $50 for each R500 chips plus around $25 to NEC for eDRAM and $5 to $10 to ATI for royality per chip.

Ruined
06-07-05, 12:22 AM
I thought it was $75 to $100 loss on each Xbox.

I read in other forums, many think the real cost Microsoft will lose on each Xbox 360 are $200 because it not mentioned many other manufacturers charges fee like TSMC and others. Microsoft probably will pay TSMC around $50 for each R500 chips plus around $25 to NEC for eDRAM and $5 to $10 to ATI for royality per chip.

It was confirmed at $175 at launch for XBOX1 by one of the financial sources I read recently.

MS losing $75 on each xbox360 means just that, they will lose $75 per console, no more, no less.

So, MS did a good job in trimming their loss by $100 for this generation. Plus, they are in better position to reduce costs in the future as they are not stuck in the chip contract with Nvidia this round.

This is also part of the $75 lost:
from gamesindustry.biz

"Some details have trickled out, though, courtesy of Wedbush Morgan Securities analyst Michael Pachter. In a recent research note, Pachter confirms that Microsoft "has agreed to pay a small royalty to Nvidia to allow the Xbox 360's ATI chipset to emulate the performance of the Nvidia chipset in reading certain Xbox games." Nvidia, therefore, will not only be receiving royalties from its partnership with Sony for the PS3, but it will also still get small payments from Microsoft for every 360 despite the fact that Nvidia is no longer the GPU provider."

AthlonXP1800
06-07-05, 12:37 AM
Hmmm Nvidia probably will get $1 to $2.50 royality from each Xbox 360. By 2011, Nvidia will make total revenues between $10bn to $20bn royalty if Sony can break 90 to 180 millions PS3 mark. And make around $20m to $50m royalty from Xbox 360 if it reach 20 million units sold. :)

Bad_Boy
06-07-05, 02:39 AM
http://www.gamespot.com/news/2005/06/06/news_6127039.html
Meanwhile, an analyst report quoted by the Toronto Globe and Mail (registration required) claims to answer another burning question regarding the Xbox 360. The tech-savvy Canadian daily cited a report by UBS Securities analysts Patrick Parr and Martin Cecchetto, which estimated that Microsoft "will pay its manufacturing partners about $375 (US) a unit and sell them to consumers for $299."

The Toronto Globe and Mail article also said that Microsoft will pay out "between $350 million and $450 million this year and between $900 million and $1.1 billion in 2006" to manufacturers of the console. Divided by the estimated $375 manufacturing price--which will eventually go down--such expenditures would mean Microsoft expects to ship around 933,000 to 1.2 million Xbox 360s in 2005, with another 2.4 million to 3.2 million going to market in 2006. Multiply those figures by the estimated $76 loss Microsoft will take on each Xbox 360, and the company could lose as much as $91.2 million and $243.2 million on console hardware production in 2005 and 2006, respectively.

However, while the analyst report bears the respectable UBS imprimatur, the figures it contains remain estimates, not official numbers. Unfortunately, that's all the public has to go on at the moment, as Microsoft won't go into the financial specifics of the Xbox 360 launch. "We do not comment on rumors or speculation," said the same spokesperson.

with the next gen games being 60 dollars a pop (unfortunately for us), it should be a bit easier to make up in software sales.

evilchris
06-07-05, 01:11 PM
Hmmm Nvidia probably will get $1 to $2.50 royality from each Xbox 360. By 2011, Nvidia will make total revenues between $10bn to $20bn royalty if Sony can break 90 to 180 millions PS3 mark. And make around $20m to $50m royalty from Xbox 360 if it reach 20 million units sold. :)

Why would NV get royalties from Xbox 360....

superklye
06-07-05, 01:22 PM
Why would NV get royalties from Xbox 360....
Read above. MS is paying a small royalty for emulation of nVIDIA hardware.

Vapor Trail
06-07-05, 01:41 PM
Can someone explain why a next gen console costs half as much as a next gen video card?????

Vagrant Zero
06-07-05, 03:05 PM
Why would NV get royalties from Xbox 360....

Backwards compatability. Emulation doesn't cost anything if your product works completely differently than the original product [ie, ZSNES vs SNES] but if you're trying to replicate that original product and make a profit off it you'd have to settle with the original product maker first.

Nvidia is going to make out like a bandit this generation.

evilchris
06-07-05, 03:08 PM
Can someone explain why a next gen console costs half as much as a next gen video card?????

PC users will generally pay it no questions asked. Consoles won't sell if they were at those prices, other than to a few impulsive nerds who "gotta be 1st".

Things are always priced according to what users will pay. If people would stop paying 500$ for next gen cards they wouldn't cost 500%.

six_storm
06-07-05, 03:23 PM
Can someone explain why a next gen console costs half as much as a next gen video card?????

That's what I've been asking since the unveiling of the next gen consoles. I mean, spending over $1500 for my PC seems really stupid to me when a new console comes out for under $500 and pwns my gaming PC. WTF!?!?!?! Kinda wish I could get my money back lol.

evilchris
06-07-05, 03:28 PM
Yeah, I regret wasting money on my Ultra. My PC is an email and Internet machine only.

Vapor Trail
06-07-05, 06:57 PM
Yeah, I regret wasting money on my Ultra. My PC is an email and Internet machine only.


I feel the same. It is certainly starting to look like PC gaming is taking a back seat to console gaming both in the number and quality of games and certainly in the bang for buck in the hardware department. It also seems that many game developers are targeting the PC as an afterthought after they have finished their console games. :(

I really can't see buying a new video card this gen with the Xbox 360 and PS3 coming so soon.

Heh, BFG may actually have to worry about providing a lifetime warranty on my 6800GT as I plan to use it for quite a while. ;)

stncttr908
06-07-05, 07:13 PM
Yeah, I regret wasting money on my Ultra. My PC is an email and Internet machine only.
I hear you. My next build will probably include a mid-range video card only. I spent $350+ on my Radeon 9800 Pro over two years ago, and my PC gaming has dropped off since then.

evilchris
06-07-05, 10:00 PM
I still like PC games, though I have bought literally three in 4 years. But I don't think the 500$ card is ever necessary even though I'm prone to buying them. I guess I don't practice what I preach. I am planning on PC gaming for at least 6 months now that X360 is coming and Xbox1 I am basically done with. Plus I just won a free copy of UT 04. =) I also have dusty Doom3 and Farcry I never went through.

It just gets me when I'm running IE and Outlook, and am aware that a 6800 Ultra is in use. I think " why didn't I wait? ".