Next-Gen Hardware Costs
I hope that DQ Videogame Industry Analyst Michael Pachter weighs in on this, but an analysis done by Merrill Lynch claims that the Xbox 360 will initially cost $340 per unit to manufacture, while the PS3 will cost $495.That $340 is for the premium system or whatever they call it.
That seemed like a huge delta, but the primary differences are in the CPU ($160 for the Cell versus $100 for the 360 CPU) and the optical drive (Blu-ray $100 versus $25 for DVD). That's a difference of $135 just for those two items.
If correct, that's an absolutely gigantic cost delta for Sony to overcome. They aren't going to make it in this generation if they charge $100 more than Microsoft, let alone $150. There would have to be huge differences in the capabilities of the consoles, and nothing this far indicates that.
Sure, the Blu-Ray drive is nice. But the PS2 had a DVD drive, and I don't know anyone who used the PS2 as their primary DVD player. I especially don't know anyone who bought their PS2 because of that function.
Three years after launch, Merrill Lynch estimates that Microsoft will still have a $50 advantage in manufacturing costs.
Here's the problem: Sony can't come up with another configuration that's cheaper. The CPU can't be changed, and Sony has pumped the Blu-Ray drive so much that they couldn't possibly leave that out. So they're stuck.
At this point, I'm amazed that Sony is proceeding with this configuration, unless they're going to eat $100 per console and come out at $399. If they try a $499 price point, they'll still do well in Japan, but it will be a disaster in the U.S.
Of course, when they finally do launch in the U.S. (in spring 2007, I believe), maybe some of these component costs will have come down.
<< Home