Topic: 3DS to Cost $200!

So What? Your paying for cuality, if you want something cheap go and buy a used ds lite.

I estimate the price of the 3DS will be $436.43 because the planets are aligned in such a way that both 4 and multiples of 3 would draw positive spirits into the 3DS.

Keep in mind that a $100 graphics card nowadays is far superior to a $100 graphics card of yesteryear.

Wow. Time to start saving. : (

On the other hand $1 now is worth less than $1 of yesteryear.

I'd say that's a pretty fair price. The DSi was about $170. For $30 more you're getting incredible graphics, 3D technology, improved online capabilities and fracking OCARINA OF TIME, KID ICARUS AND METAL GEAR SOLID IN 3D!!!!!!!
ahem...excuse me...

The DSi, given how little of an upgrade it actually is (better Wifi capabilities, bigger screen, and crappy camera) is not that much of an upgrade from a DS Lite which is $150. The profit margin on the DSi is surely very comfortable for Nintendo. They could release a device significantly better for the same price and still turn a profit. Once it releases, there'll surely be a large price drop for the DSi as well. I think it could easily be released for $180, but given that they did fairly well selling it for $180, they very well could be emboldened to go with a higher price.

The profit margin for the Nintendo DSi seems to be around $40. But (and this is a big but), whenever people calculate profit margins, they don't typically take into account R & D costs (which are significant and 'made back' over the sale of many, many units) and marketing, logistics, developer support and so on and so forth. They seem to forget that the manufacturing process is not all it takes to get the console into your hands.

Now, the 3DS isn't actually that much of a jump of the DSi in terms of R & D investment (remember, for the DSi Nintendo needed a new OS interface, a online shop, camera integration and photo editing tools, all new for them). Marketing, logistics and developer support costs will also be comparable, I would anticipate.

With that in mind, if Nintendo does indeed charge around $200 for the console, than the actual margins they'll be selling the console for will actually be minimal.

Of course everyone knows the money for Nintendo Sony and Microsoft is in the licenses for developers and publishers, so Nintendo will be willing to make minimal margins, or perhaps even a loss, to increase userbase (and thus licensing costs) in the short term, I would imagine.

To me $200 sounds about right.

@Waltz

Thanks for the information on the profit margin. R & D costs are surely significant, but there's not much really completely new with the DSi. The OS is a modified version of the Wii's, as is the shop. Surely significant work had to be done to make it fit on the DS, but it's not like they created something out of thin air. The photo/sound editing tools are really the only new things on the console, and they're not breaking any ground. At that sort of margin (plus the higher margin on downloadable game sales), they've easily surpassed the cost of developing the system.

Compared to a $230 8G iTouch, I don't think the 3DS will bring $200 worth of features to the table. However, Ninty has shown how it can print money, so I wouldn't be too surprised if they went for that price. Shoot, I'll probably even buy it for that eventually, seeing as the price won't drop until they release the 3DS Lite (may hold out for that eventuality though).

Nintendo has a set R & D budget, that goes into new console design, experimenting with new technologies, patent development, manufacturing optimisation, software development, so on and so forth. Many R & D projects never see the light of day outside of the labs.

A portion of that R & D budget would be allocated to various projects. That's a real dollar figure - it's not measured in actual physical work hours. Nintendo spends around $US500 million in R & D per year. I would suspect that the total R & D cost that went into the DSi platforms (remember there are two) will actually be equivilant in terms of dollars to what has been spent on the 3DS to date, especially considering there is still R & D work being done on the DSi. It's irrelevant how long it would take to do something. The reality is the cost is in inventing these consoles, modifying existing software to find on the hardware, developing an online structure to account for the nuances of the firmware, and then supporting the console with firmware updates - all of this counts as R & D, and is surprisingly standard.

Without knowing exactly what Nintendo's licensing structure is like - Nintendo does not get a "higher margin" from downloadable sales, either. Nintendo licenses out the right for a developer to make a game for DSiWare. That license is the money Nintendo makes from a game - and it's standard with no actual margin from sales involved.

Of course Nintendo is rolling in profits from the DSi, but it's not coming from the places you suggest - it's not coming from hardware margins, which are pitiful on a cost/ reward basis, and it's not coming from software sale margins. It's coming largely from profit from internally-developed games and licensing to third parties.

That doesn't change for the 3DS, so Nintendo needs to get as many 3DSes into peoples hands as possible so it can charge comparable licensing fee to what it charges for the DS. To do that Nintendo would be willing to make a razor-thin margin or a small loss on 3DS hardware, and I estimate that to be around $200, taking into account components, logistics, marketing and R & D.

Where do you get this information?

Ninty sold 3 million DSi's in Japan as of Aug. 2009 according to Kotaku. At $40 profit for machine that's $120 million. In less than a year the DSi in Japan alone racked up enough to cover 1/5th of Ninty's yearly R&D budget. Now, of course there's other places the money needs to go as well, but I'd say they're doing fine with hardware profits.

I agree that they are making more profits on games. Ninty's games (and to a lesser amount, 3rd party licenses) are the obvious major profit drivers, just like with any other game company. How long have MKDS and NSMB been out now? They still sell at full price. There's no doubt that games are where the most money is. That doesn't mean they're not making Uncle Scrooge swimming pool sized piles of money off the hardware too.

Also, Nintendo does get a cut from downloadable sales I believe. Devs don't get ANY money if WW games don't meet a certain sales target. That may have changed, but they are certainly getting money from downloadable game sales beyond a flat licensing fee. It goes without saying though that without retailers, shipping, and manufacturers to pay, the proportion of money that goes straight into both Ninty's and the devs pocket is MUCH higher than they would be with physical carts.

If the DSi required the same amount of R&D as the 3DS, it stands to reason that they should cost similarly (ignoring the factor of demand). By your numbers, they could easily sell it for around $180 and not be losing money. If it sells at $200, it'll be because they think there's enough demand, not because they can't comfortably supply it for cheaper.

The advances in technology far exceed the negligible amount of inflation. Unless maybe you live in Zimbabwe...

Sweet! If the 3DS only costs $200 USD, I can get it for $600,000,000,000,000,000 Zimbabwe dollars. Now where did I put my wheelbarrow?

The 3DS is set to cost... one million United States dollars.

kick this thread with the sauce yo

No, I didn't

I've not read through this post, but that would be a great price for a machine such as the 3DS. I expected it to be £200, not Dollars. If this is correct i'll buy one on day one.

Same here. For $200 dollars it HAS to be a day one purchase. That's nothing for such a innovative, yet proven tech. (I say "proven" because it will run DS games, so it's not like you are going to be making a blind jump. You have a huuuuge base to build from already, as far as killer software) And that starting lineup of games that should come at launch.... scary...

@bigdog I agree.

I've never been so excited about the release date of a release date before!