This Week In The Business: The Cost Of An Xbox One

This Week in the Business: The Cost of an Xbox One

What's happened in the business of video games this past week ...

STAT | $US471 — Amount it costs Microsoft to manufacture each Xbox One, according to research firm IHS; this compares to a manufacturing cost of $US381 for the PS4, which means neither device makes a profit at retail considering discounts and marketing costs.

QUOTE | "The digital version of a product should be a hell of a lot less expensive. Steam does it right. It's cheaper and at times phenomenally cheaper." — Sony fan Ray Barrett, waiting in London for the PS4 launch, on why digital versions of games should be cheaper.

QUOTE | "We need an audience who is motivated enough to find stuff. But it seems like people just want to sit there and have stuff shoved in their face." — Metanet's Raigan Burns, on the challenges facing indie developers.

STAT | Over $US20 million — Amount that charity Child's Play has raised to help sick children and their families through play in its 10-year history; according to Child's Play, the gaming community has raised over $US2.5 million in 2013 alone.

QUOTE | "We can't wait until everything is perfect to start." — Square Enix's Latin American subsidiary manager Igor Inocima, on the publisher's aggressive approach to the "exploding" Latin American market.

QUOTE | "We've changed every year over the past 10 years." — Co-founder Andrew Eades of developer Relentless, on the company's evolution from exclusively Sony titles to working with Hasbro and Microsoft.

QUOTE | "'I would not expect many changes to the game as a result of my departure." — Greg Street, lead systems designer on World of Warcraft, on his resignation from Blizzard.

STAT | $US250 million — Amount that Sony is looking to cut from expenses in its entertainment business; this includes shifting movie investment to TV networks and reducing the output of Columbia Pictures.

QUOTE | "The blunt reality is that easier production equals more creative freedom and opportunity." — Chinese Room creative director Dan Pinchbeck, talking with other indies about what next-gen consoles mean to them.

QUOTE | "In the years to come, the big properties at E3, the $US100 million properties, they will have started off in the indie space." — Industry veteran Lorne Lanning, along with others, on the future of next-gen games.

This Week in the Business courtesy of GamesIndustry International Image by deepblue-photographer [Shutterstock]


Comments

    don't want to register on another site but the steam digital prices are only true during steam sales. the rest of the year, especially in Australia the prices are really high and sometimes more than physical products. This is taking into account that publishers set their own prices on steam - just pointing out that steam has problems too.

      CoD ghosts is my favourite. It was $40 prerelease, upon release, $80 (I figured they should shove their digital rehash where the sun doesn't shine).

      Still better than the $110 I paid for blops2 the year prior, also on steam (it price matched a video ezy physical copy for fuck sake).

        You paid the $110? And you're complaining about game prices?

          What's your point?

            You're part of the problem that you are complaining about. Publishers charge Australians $110 because there are chumps that will pay that much.

              So, I'm part of the problem when I refused to pay for the latest installment of the CoD franchise, because I was foolish enough to make the mistake the year prior?

              Best logic ever.

            A product is worth exactly as much as the market will pay. You help keep the prices high by seeing the local price at 210% of the US price and then paying it.

              Publishers charge Australians $110 because our Government allows them.

              See my reply to Bangers.

                You were part of the problem when you did it. If you refuse to do it now, then you have ceased being part of the problem.

                  Something I thought was pretty obvious with "I figured they should shove their digital rehash where the sun doesn't shine".

                  Hence why I asked the other guy what his point was. It was invalid when he made it.

        Actually cod ghosts was never $40, if you clicked to buy it at that price you would see that they were advertising the digital deluxe upgrade as the actual game, it was always $80. Either a silly mistake or deliberate click bait.

        Actually it was also $80 prerelease. I saw the $40 and thought it was odd, so drilled down a bit. The $40 price was just for one particular extras package; the price they had listed for the game itself was in the $80 zone. I don't know if it was a deliberate bait-and-switch or if somebody at Valve just screwed up.

        However, CoD pricing is down to Activision. (Even CoD:World at War is still $40!) Most publishers are more sensible and gradually reduce pricing in line with what happens at physical retailers. The best pricing is generally on items over a year or so old.

        The fact that they have 4-5 sales per year, and that those sales usually include some quite large discounts, also helps a lot.

    Wow, Xbox costs more to make by $90? That's... kind of surprising. Even with the Kinect.

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