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Xbox 360 costs $715 to make?

715? That is fucking ridiculous. And their source is dubious at best. Like others, I'm calling bullshit.

And if 360 cost 715, what does PS3 cost to make... 900?
 
Amir0x said:
715? That is fucking ridiculous. And their source is dubious at best. Like others, I'm calling bullshit.

And if 360 cost 715, what does PS3 cost to make... 900?
Click to expand...

Sony said back at E3 that their graphics card was better than 7800 sli, so it must be over 1000!
 
SantaCruZer said:
Sony said back at E3 that their graphics card was better than 7800 sli, so it must be over 1000!
Click to expand...

Heh. Pricing/manufacturing doesn't work like that though for consoles, in case you weren't being sarcastic.

Anyway, if just the 360 is 715 to manufacture... yeah. That'd be crazy. INCONCEIVABLE.
 
Wax Free Vanilla said:
550 US Dollar manufacturing cost

US retail price - 349.99-399.99 US Dollar
UK retail price - 299.99-349.99 Pound Sterling
Click to expand...

i bet you joystiq will post this on their site now and say it's from a 'well known nVidia employee who worked on RSX'
 
Amir0x said:
Anyway, if just the 360 is 715 to manufacture... yeah. That'd be crazy. INCONCEIVABLE.
Click to expand...
Why? MS wanted to be first to market without sacrificing much on the power front - I'd be surprised if there isn't a hefty premium on that.
 
kaching said:
Why? MS wanted to be first to market without sacrificing much on the power front - I'd be surprised if there isn't a hefty premium on that.
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It just goes against everything we've heard on Microsoft's strategy AND the component prices don't seem to match up. There was a pretty good breakdown of it before, and it came to like 530 or something, but I can't think of how this sort of price could get the jump on anyone with a premium of 715 dollars. The source has to be wrong.
 
maybe the source knows of the "hidden feature" that was being touted awhile back around the japanese launch. :lol
 
I thought the main shift in MS's strategy was in that they were employing components that can scale down in price to manufacture better, not necessarily that they started off cheaper than the last time around. The suggestion that it possibly costs as much as $715 to manufacture and xbox360 now doesn't necessarily contradict their shift in strategy. And their premium pricing on the accessories front certainly would help to buffer the additional cost in the short term.
 
Amir0x said:
715? That is fucking ridiculous. And their source is dubious at best. Like others, I'm calling bullshit.

And if 360 cost 715, what does PS3 cost to make... 900?
Click to expand...

Not necessarily. Sony needs to outsource far less components than MS.
 
kaching said:
I thought the main shift in MS's strategy was in that they were employing components that can scale down in price to manufacture better, not necessarily that they started off cheaper than the last time around. The suggestion that it possibly costs as much as $715 to manufacture and xbox360 now doesn't necessarily contradict their shift in strategy. And their premium pricing on the accessories front certainly would help to buffer the additional cost in the short term.
Click to expand...

you know how much 'scaling down' would have to occur for it to catch up with the system price at even 400, let alone what it'll be after 360 inevitably drops price every year or so. That's a 315 dollar difference at start, a huge hit. That sort of thing would not be helpful to Microsoft supposed strategy of turning a profit within a few years, even with insane accessory prices. Anyway, unless we find some phantom component OR someone horribly miscalculated the cost of one of the present 360 components, there's nothing I can add up even with the most pesimistic estimates to make it 715 dollars.
 
'It costs Microsoft approximately $715 to make, the manufacturing costs are still too high, another reason why they’re producing relatively small quantities.'
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This right here tells me the article is BS. If the $715 was true, that has no relation to how many consoles MS plans to manufacture.
 
jedimike said:
This right here tells me the article is BS. If the $715 was true, that has no relation to how many consoles MS plans to manufacture.
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Also, if the $715 were true they'd be making them as fast as they could to try to slim down the fixed/marginal costs ratio.
 
Amir0x said:
you know how much 'scaling down' would have to occur for it to catch up with the system price at even 400, let alone what it'll be after 360 inevitably drops price every year or so. That's a 315 dollar difference at start, a huge hit.
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I understand all of that but the costs aren't necessarily going to scale linearly. Perhaps there'll be one of the sharper cost reduction events once they get past the hurdle of launching early and worldwide with components that are still relatively exotic.

...OR someone horribly miscalculated the cost of one of the present 360 components
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That would be the suggesting being made here.
 
Amir0x said:
Heh. Pricing/manufacturing doesn't work like that though for consoles, in case you weren't being sarcastic.

Anyway, if just the 360 is 715 to manufacture... yeah. That'd be crazy. INCONCEIVABLE.
Click to expand...

It was sarcasm...
 
kaching said:
I understand all of that but the costs aren't necessarily going to scale linearly. Perhaps there'll be one of the sharper cost reduction events once they get past the hurdle of launching early and worldwide with components that are still relatively exotic.
Click to expand...

Perhaps. But I still cannot understand this price.

kaching said:
That would be the suggesting being made here.
Click to expand...

Ok, fine, I accept this theory. Now my challenge to you (or joystiq's "source") is to point to where this mistake in component pricing estimates could have possibly be made. I mean, think of it for a moment. 360 is a phenomenally well designed system with a fantastic interface and what have you, but it does not have anything that is so outrageous as to bounce the price up this level is what I'm saying. Even if you high balled estimates, I could not come to this conclusion.

So yeah, I mean, you point out to me where the mistake could have been. I honestly can't see how it's possible.
 
I wouldn't be shocked if this came from Nightfraud or a Nightfraud clone:

"I was smoking crack with an MS employee who told me the Xbox 360 cost $715. We had nothing better to do than talk about game costs and all of their secrets that will never show at game shows. Then I'll cover my ass by making fun of myself so I can avoid getting flamed to a crisp."

Ahem, excuse me.
 
Amir0x said:
Ok, fine, I accept this theory. Now my challenge to you (or joystiq's "source") is to point to where this mistake in component pricing estimates could have possibly be made.
Click to expand...
Sorry, I shouldn't suggest it's necessarily a mistake - any estimate is just one scenario based on a certain set of assumptions playing out. The lower cost estimate by analysts is probably based on some assumptions about achieving certain minimum yields of key components like the CPU and GPU. But what if the yields are actually lower than what you'd normally want before starting mass production and MS is having a significant amount of silicon thrown away in order to stick to their original schedule?
 
There was a much more reliable breakout a few weeks ago posted here. I can't find it, but what the team did was analyze every standard, off the shelf part (resistors, capacitors, board costs, etc.) on the system and take the going market price for each, then estimates for the unknowns (custom parts such as the cooling solution and chips). I think it was in the $500 range and was much more resonable, and methodical, than what we see here.
 
Jeff-DSA said:
If this is true, I'll gladly pay $10 extra for a wireless controller. They gotta make the money back elsewhere
Click to expand...


What the hell is that stupid comment?
Are you charity or something?? I've never heard something so brainwashed and gullible. It's NORMAL they lose money on hardware. It's like that for ALL consoles ever and forever. It'S part of the process. They don't need your care my friend, they rip you off your every penny some thousand years before they'll need you. Go buy Katamari Damacy, Shadow of The Collossus or some daring obscure game if you really want to matter in this world. Microsoft is going to be perfect fine and would have been perfect fine even with their accessories REDUCED by 10 bucks.
 
I don't see how MS shareholders would allow for some discrepancy like this, let alone Gates. He would come unglued I believe if this figure were true.
 
Dr_Cogent said:
I don't see how MS shareholders would allow for some discrepancy like this, let alone Gates. He would come unglued I believe if this figure were true.
Click to expand...

I'm a shareholder... I didn't get the memo. However, anyone that believes the 360 costs $715 to make is a f'ing moron. OK, I'm done with that now.
 
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