Nintendo 3DS Raw Materials Just Cost $100, Have We Been Robbed?
Is Nintendo robbing the consumers from a possibly cheaper Nintendo 3DS? Or is there more to the hardware than meets the eye?
Nintendo has always provided their consumers with top-notch, relatively cheap products that usually leave us smiling. But an analysis from UBM TechInsights may put things in perspective for a moment, as they unveiled that Nintendo 3DS’ raw components cost roughly $101 per unit. The Nintendo 3DS unit currently has a retail price of $250, around 150% more than what it is made. Has Nintendo robbed its consumers?
Well, there’s more to the tale than the raw figures. The makings of a Nintendo 3DS doesn’t only comprise of its raw materials. Beyond its bits and pieces, money has to be shelled out for marketing, research, development costs, labor, packaging and distribution. And even though the raw goods sound cheap, the rest definitely isn’t. That’s why the Nintendo 3DS is priced that way.
Hardware makers initially sell their goods at a loss to increase potential profits from software licensing fees. Companies like Microsoft and Sony didn’t immediately make profit during the first months of the Xbox 360 and PlayStation 3. In fact, according to iSuppli, Sony was taking a $300 loss on each PS3 during its launch despite its colossal price tag. The company only showed signs of profitability when the console was redesigned to the PS3 Slim.
So whenever you look at your Nintendo 3DS, remind yourselves that it isn’t just the metal and plastic that you paid for. It’s the sheer engineering and marketing skills of a company that does what it does best: Provide top notch entertainment for the world to gander at.View Article Source »