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360 Costs Half As Much As PS3 By 2006?
EGSonikku writes "According to Merrill Lynch, after doing a breakdown of hardware and manufacturing costs., the XBox 360 may end up as little as half the cost as Sony's PlayStation 3 by 2006.
Citing Sony's financial woe's and Microsoft's deep pockets, they predict '...Microsoft's Xbox 360 should emerge as the early winner in the next round of the game console wars.'"
The dev tools will always be at least six months behind then, but more importantly, Microsoft has far and away more experience writing dev tools than Sony and consistently has provided some of the best tools available in the software industry. Plus a huge complaint against the PS2 was how hard it was to develop for and as far as I know, they never fixed that, developers just learned to deal with it. Why would you expect Sony to catch up?
Feel free to mod me "-1 - Angry Jerk".
The one thing that always surprises me when it comes to analyst speculation is how they always compare these companies as if the 'costs' of production are equal between these companies. Nintendo, Microsoft and Sony have completely different strategies in the manufacturing of hardware that benefits different companies in different ways. When you consider that the actual physical cost of producing a single unit is pretty small (compared to the purchace price) and that the majority of costs are technology and manufacturer profit you will see why Microsoft can not compete with either Sony or Nintendo.
Nintendo partners with Panasonic (I beileve that it is under a different name; the name of their parent company) to produce the console and most of its components; the main components not produced by their partner are the CPU, GPU and Memory (almost everything else is Panasonic technology). What this means is that Nintendo's manufacturing partner (panasonic) and technology partners (IBM,ATI) are about the only companies taking a cut on their system.
Sony doesn't need a manufacturing partner and thus only the technology partners (IBM/Toshiba,Nvidia) take a cut on the production of a console; even Sony's technological cost on something like the blu-ray drive can be ignored because it will effect multiple product lines (the inevitable Blu-ray DVD players, Blu-Ray PC drives, etc.)
Microsoft on the other hand licences technology (or has aquires components) from several different companies; the Hard-Drive comes from one company, the DVD drive from another, many electronic components from yet another, etc. With all these companies involved there is a massive overhead.
I, personally, couldn't even come up with a guestimate on what the XBox 360 or PS3 cost to manufacture; I can say that I suspect that if Microsoft used their current strategy and built the exact same system as Sony, Sony could produce the system at a much lower pricetag.