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Posted by MassiveProng on 01/19/07 01:21
On Thu, 18 Jan 2007 18:31:39 -0600, "Aaron J. Bossig"
<linkvb06@SpammersWillBeExecuted.ptd.net> Gave us:
>
>getrich@1upandup.com wrote in
>news:1169165483.934864.286800@v45g2000cwv.googlegroups.com:
>
>>> Rich, that's based on retail. Microsoft doesn't make money off the
>>> retail price, their money is made off of the price at which they sell
>>> it to the retailer or the wholesale price. It's possible they are
>>> close to breaking even on the console with games putting them in the
>>> profit column.
>>>
>> According to this article Microsoft is making a profit per each sale,
>> as the cost to make it is less than what it retails for. Of course,
>> Microsoft sells it for less than the retail price. Point now is,
>> according to the article, Microsoft is not losing money per console on
>> manufacturing costs. The profits are made in the razor blades, not
>> the razors.
>
>Retailers don't make much profit on video game hardware, so the sticker
>price you see for any given console is probably going directly back to
>the manufacturer. Like anyone else, they make their money on the games
>and accessories.
>
>So, comparing the retail price to what MS claims is the production cost
>is, actually, a very fair analysis. The only other factor is the shipping
>cost from the factory to the retailer.
Which is typically borne by the retailer.
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