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Old 09-26-2011, 04:34 AM   #53
afa
The Forgotten
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Quote:
Originally Posted by jhempel24 View Post
Consoles don't make money, they actually lose money on the consoles and make the money from the games.
I don't think that is true anymore.

Console manufacturers sell the hardware at a loss... initially. That's because they spend so much on R&D that making a profit would mean pricing the device out of the reach of most of their demographic. Even when the PS3 was launched, it retailed for about $600, which was pretty steep. And even that, apparently, was a loss making price. It now retails for $250.

As the manufacturers achieve economies of scale, their production costs per unit decrease quite substantially. And once the sales of the devices reaches a certain point, the accounts are back in the black.

I'm pretty sure both Sony and Microsoft have long since crossed that point.
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