DV Hardware - bringing you the hottest news about processors, graphics cards, Intel, AMD, NVIDIA, hardware and technology!

   Home | News submit | News Archives | Reviews | Articles | Howto's | Advertise
 
DarkVision Hardware - Daily tech news
November 17, 2018 
Main Menu
Home
Info
News archives
Articles
Howto
Reviews
 

Who's Online
There are currently 157 people online.

 

Latest Reviews
Arctic BioniX F120 and F140 fans
Jaybird Freedom 2 wireless sport headphones
Ewin Racing Champion gaming chair
Zowie P-TF Rough mousepad
Zowie FK mouse
BitFenix Ronin case
Ozone Rage ST headset
Lamptron FC-10 SE fan controller
 

Follow us
RSS
 

Xbox One production cost estimated to be $471

Posted on Thursday, November 28 2013 @ 11:52:47 CET by


Microsoft logo
A teardown performed by IHS found that Microsoft's Xbox One has a $90 higher production cost than Sony's PS4. While the PlayStation 4 is estimated to have a total manufacturing cost of $381, the Xbox One has a bill of materials (BOM) of $457 and a manufacturing cost of $14, totaling $471, or $28 less than the $499 retail price. Taking into account other expenses it seems both firms are still taking a loss on the initial production.

The biggest difference between both consoles is that Microsoft decided to include Kinect as a standard feature of its console. The Kinect adds $75 to the Xbox One's manufacturing cosT.
"For both Microsoft and Sony, their latest-generation video game console hardware is unprofitable at the time of release, requiring the companies to subsidize it initially," said Steve Mather, senior principal analyst for IHS. "However, these companies can largely compensate for their losses though sales of highly lucrative game titles. Meanwhile, as the cost to produce the consoles decreases according to the normal learning-curve dynamics in the electronics industry, the companies can cut their retail pricing – or pad their profits. Over time, Microsoft is likely to reduce the retail price of the Xbox One in order to maintain sales momentum."

Microsoft may also be more willing to take a loss on hardware sales with the Xbox One than it has for its previous-generation products. "The Xbox One is designed to serve as a beachhead in the home for Microsoft, with the console's capability to interact with – and interface to – other devices, such as televisions, set-top boxes, smartphones and tablets," Mather noted. "Gaining such a strategic advantage in the battle to control the connected home and Internet-enabled living room is well worth having the Xbox One act as a loss leader for Microsoft."




 



 

DV Hardware - Privacy statement
All logos and trademarks are property of their respective owner.
The comments are property of their posters, all the rest © 2002-2018 DM Media Group bvba