Nintendo May Be Earning Money on Wii[12/15/2006 09:21 AM]
Nintendo Corp., a leading producer of game consoles, may be earning money from selling Wii game console, according to a report by a Japanese news-paper. Apparently, the total bill of materials of the new game console is just about $160, which is dramatically lower than the manufacturing cost of consoles like PlayStation 3 or Xbox 360.
Toyo Economics TK news-paper has published teardown analysis of the Nintendo Wii game console, according to which each unit of the game machine costs Nintendo as much as $158.3. The news-paper states that ATI-developed code-named Hollywood graphics processor costs $29.6, IBM’s custom Broadway microprocessor takes $13 to be delivered to Nintendo, $31 is paid for Matsushita-made optical disc drive, memory array costs $7.80 and power supply unit stands at $11.30. Nintendo reportedly pays Foxconn Electronics $19.50 for Wii assembly, reports WiiInside web-site.
Nintendo set the recommended retail price of ?25 000 (about $211) in Japan, $249 in the U.S. and ?249 ($325) in Europe, which means that the actual price of the console may exceed the bill-of-materials cost by up to two times, implying that the company may make profits on its hardware, something unusual in the game console business.
So far Nintendo shipped over 1.3 million of its Wii game consoles worldwide.
Nintendo Wii console features IBM’s custom PowerPC architecture-based microprocessor named Broadway clocked at 729MHz and code-named
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