Analyst says Wii manufacturing costs down 45% since launch

by David Hinkle { Apr 7th 2009 at 11:30AM }

Since the Wii released in November of 2006, it's progressively become a more profitable venture for Nintendo. Not just because it has been constantly flying off retail shelves, but because Nintendo has managed to drastically cut down manufacturing costs during its life, Koya Tabata of Credit Suisse suspects. In fact, Tabata says costs are down a whopping 45%, which could mean Nintendo is banking much more than the previously reported $6.

Of course, any talk of reduced manufacturing costs is inevitably going to lead to talk of a price cut, which Tabata says is a real possibility. Emerging markets could be the first to see a price cut, Tabata commented. With Sony hoping to take market share away from Wii with its $99 PS2, it might be the right time for Nintendo to trim some fat.

[Via Eurogamer]

Tags: analyst, credit-suisse, koya-tobata, manufacturing, manufacturing-cost, price-cut

Related From Joystiq

Analyst: 'Sony was saved by the success of the Wii'
24 days ago
Iwata voices interest in Kindle-like free 3G service for DS
27 days ago
Iwata: Wii's 2009 lineup allowed the 'mood' to 'cool'
30 days ago

Reader Comments (Page 1 of 2)

WRE @ Apr 7th 2009 11:33AM

I don't think Nintendo is scared of the PS2 at all. Can anyone provide a solid reason as to why they should be?

Markez @ Apr 7th 2009 11:35AM

It eats babies.

WRE @ Apr 7th 2009 12:15PM

Eeeekkkkk!

Markez @ Apr 7th 2009 12:23PM

Just made me think of Flanders' girly scream. Was flower bed or something, or a house plant was dead?

WRE @ Apr 7th 2009 12:46PM

House plant.

Spartacus @ Apr 7th 2009 2:52PM

Don't forget about purple drapes. Flanders always wanted purple drapes.

Phantom @ Apr 7th 2009 3:51PM

Because the PS2 is destined to control the third world game market. Cheapest supported console, and a huge library of games(that are cheap now)

Markez @ Apr 7th 2009 11:35AM

Flimshaw! I find a price cut unlikely, but in this environment who knows. This is especially disconcerting considering I thought they'd just jacked the price up in part of the EU?

Maybe that adorable little purplish PSP I keep seeing everywhere is stealing their marketshare. It'll probably be on top of the NPD next time we see those #s. DAMN YOU HANNAH MONTANA!

Russ Carroll @ Apr 7th 2009 11:35AM

Why? I mean really why?
B/C the Wii got outsold for a single month in Japan?
Did the analyst also note the increase of price of the Wii in Europe?
How does that figure in with increased revenue per system on 45% decreased manufacturing costs? (well...it conflicts!)
I'm glad the analysts have something to talk about, but every time they talk I wonder...why?

Rob @ Apr 7th 2009 11:39AM

The Nintendo Wii: Now it prints even more money!

David Black @ Apr 7th 2009 11:42AM

Clearly this is one of the upsides of avoiding cutting-edge hardware in your console build. I could definitely see Nintendo do a small price cut in certain markets, it would alleviate that PR problem of actually seeing Wii's on store shelves for longer than 5 minutes....

Ronin @ Apr 7th 2009 11:45AM

I think the Wii is due for a $50 price cut, and Nintendo is simply holding that Ace close to the vest for a situation where they need to spike sales...

Chris D.(PSN: Aggie_CEO | XBL:The Aggie CEO | Steam: Aggie_CEO @ Apr 7th 2009 12:16PM

nah they dont need to do that anytime soon. They will release it in various colors before dropping the price I think

Roto13 @ Apr 7th 2009 12:30PM

Price cuts come from slowing sales, not from actual hardware costs.

Ronin @ Apr 7th 2009 1:52PM

Uh, yeah...that's why I said when they need a spike in sales. Of course price cuts do not come purely from manufacturing cost, nor did I assume that.

However, Now that demand is finally being met and the Wii is much more readily available in-store, it may just be a matter of time, as the 3rd anniversary of it's launch approaches.

Gehodra @ Apr 7th 2009 3:00PM

I think the Wii is due for some games. When's Tales of Grace coming out?

Mr Khan @ Apr 7th 2009 11:56AM

It should be about to get much cheaper, since they're apparently poised to die-shrink by 50% (apparently they've been 90 nm from the beginning, which i had always assumed they were smaller than that).

sam @ Apr 7th 2009 1:57PM

The CPU is simple enough in the first place that you don't need to run on the newest (and most expensive) fabrication plants in order to produce it efficiently - hence why they're using the older technology. If they're going to shrink it that's good news for everyone in terms of power usage though. (I think Wii has a fan - maybe they can get rid of that if they cut the power consumption a touch more, that would save some money.)

Price cut would be nice, I'd expect to see one at least before next Christmas - of course we've been saying that every year...

Mr Khan @ Apr 7th 2009 2:23PM

From what i've heard, the die-shrink will also remove the fan.

ittybittygirl @ Apr 7th 2009 11:57AM

Instead of a price cut, I'd love to see them release a bundle with a 4/6/8 GB SDHC card and Component cables at the current $250. In a glossy black shell of course.

dark_inchworm (on Steam!) dark inchworm (on XBL!) @ Apr 7th 2009 12:21PM

With Calvin Tucker's Redneck Jamboree bundled in, right?

Chris D.(PSN: Aggie_CEO | XBL:The Aggie CEO | Steam: Aggie_CEO @ Apr 7th 2009 11:59AM

Why do they need to cut the price??? N is selling Heroin cut with baking soda for less then their competitors pure porduct. So why drop the price is the addicts are just going to keep paying the price for it thats already there?? Hell if anything they'll just bag it up in new colorful bags and get more sales....

Cody @ Apr 7th 2009 12:08PM

Being an ex-dealer myself (of weed, not H or white girl you guys, please feel free to not alert your local authorities) your post is full of win Chris lmao

Chris D.(PSN: Aggie_CEO | XBL:The Aggie CEO | Steam: Aggie_CEO @ Apr 7th 2009 12:10PM

ROFLMAO!!!

dark_inchworm (on Steam!) dark inchworm (on XBL!) @ Apr 7th 2009 12:22PM

Hey Cody, you may not deal white girls, but if you know anyone who does, please contact me immediately. I was wondering if I could get a moderate-sized group (say, three or four) for "research."

Cody @ Apr 7th 2009 12:26PM

LOLLLLLLLLLL indeed, will do good sir!

Chris D.(PSN: Aggie_CEO | XBL:The Aggie CEO | Steam: Aggie_CEO @ Apr 7th 2009 12:27PM

looking for that white in this economy is hard....gonna have to go with the Heroin/Cocaine hybrid which is more potent and will get you 347% higher in less time than the Coke alone...

Bowser Rogozhin @ Apr 7th 2009 12:31PM

The only thing more disgusting than drug users are drug dealers. It's not like you people don't have an option, you're all working professional, white collar jobs. And there are going to be kids reading this jibber-jabber. Shame on you all.

Chris D.(PSN: Aggie_CEO | XBL:The Aggie CEO | Steam: Aggie_CEO @ Apr 7th 2009 12:34PM

White Collar jobs???

I have no collar unless I decide to put on a button up. even then its just while conducting business. as for the Kids.....they are the SAME ones whose parent buy them games Like GTA and then leave prescription drugs where they can be easily gotten to and mixed with Robitussin to make some stuff FAR more dangerous than Cocaine or Heroin...

Bowser Rogozhin @ Apr 7th 2009 12:42PM

I don't know what "Robitussin" is, but you're clearly a moron. Stop talking.

j.howlett @ Apr 7th 2009 12:51PM

cocaine is a helluva drug

Chris D.(PSN: Aggie_CEO | XBL:The Aggie CEO | Steam: Aggie_CEO @ Apr 7th 2009 1:06PM

dont know what it is???

where are you from???

http://www.google.com/webhp?hl=en#hl=en&q=Robitussin&btnG=Google+Search&aq=f&oq=undefined&fp=nMdsL-Nghcc

at any rate how am I a moron??? hundreds of kids overdose from meds in their medicine cabinet. FOR more than the amount that OD on Illegal drugs.

Bear @ Apr 7th 2009 1:07PM

Isn't there a $200 Xbox360?

Chris D.(PSN: Aggie_CEO | XBL:The Aggie CEO | Steam: Aggie_CEO @ Apr 7th 2009 1:10PM

yes there is. whats your point??

Bowser Rogozhin @ Apr 7th 2009 1:22PM

You're a moron because hard drugs do much more than cause overdoses. Anybody with a semblance of a brain cell would see that fact. Hard drugs cause people to become lackadaisical, they lower ambition, they ruin the health of the user and those around him/her, they bring about evils such as desperation and crime. Get out of your basement and see the real world for once in your simple life. Overdoses are a small nugget in a great clusterfuck of a problem pie, and you're praising of these illicit ills, your fornicating with the devil that is hard drugs, shows your base immaturity and all-round worthless as a citizen.

Chris D.(PSN: Aggie_CEO | XBL:The Aggie CEO | Steam: Aggie_CEO @ Apr 7th 2009 1:31PM

ummm da fuck you just say??

at any rate. countless studies have shown that more kids are OD'ing off of NON "hard drugs" such as things in the medicine cabinet and things you can buy OTC....dunno where you are from but here in the US people do this thing called "Syrup" which is essentially a mixture of cough medicines and alcohol. it kill THOUSANDS of people a year. People like you being blind to the effects of these basic drugs are the reason why it goes unseen. and I didnt appreciate the fact that you assumed I was a drug dealer that lives in a basement simply because I read and know more about various drug types than the average person.

Cody @ Apr 7th 2009 1:35PM

Bowser, stop replying please.

Bowser Rogozhin @ Apr 7th 2009 1:37PM

"and I didnt appreciate the fact that you assumed I was a drug dealer that lives in a basement"

Change your avatar.

AirIntake @ Apr 7th 2009 1:42PM

Do you drink, smoke, or take aspirin, Bowser? If so, you are are drug user! Ever bought someone a drink, smoke, or given them an aspirin? Congrats! You're also a drug dealer. The only difference is what the government classifies you as. You obviously don't know very much about drugs, as there are quite a few government approved drugs that are "hard" and that will cause you to become "lackadaisical" etc like you claim. Vicodin, Morphine, Oxycontin, Dexedrine, and Ephedrine can cause just as much harm to the body as crack or heroin. Why does the government get to determine which drugs are 'bad' and which are 'pharmaceuticals'? It seems the drugs backed by corporations that can be taxed become 'pharmaceuticals', and the ones that aren't become 'narcotics'.

Markez @ Apr 7th 2009 1:44PM

"and I didnt appreciate the fact that you assumed I was a drug dealer that lives in a basement"

Change your avatar."

I can't begin to spout off about how ignorant and ludicrous this statement is. I really can't.

Insight @ Apr 7th 2009 1:46PM

At this point, Bowser, your entire argument for calling him a worthless citizen is that you've brought up details about drug use that he more than likely knows about and understands but didn't bring up (due to there being no real reason to).

Pretty flimsy.

Or that he mentioned drugs on an open website

Again, pretty flimsy

Or that he knows something about drugs... come on, I can't remember the last time I was within fifteen feet of an illegal drug and I know about this shit. sadly, it's just part of our culture today. Gotta love America.

Chris D.(PSN: Aggie_CEO | XBL:The Aggie CEO | Steam: Aggie_CEO @ Apr 7th 2009 1:46PM

"and I didnt appreciate the fact that you assumed I was a drug dealer that lives in a basement"

Change your avatar.

You Racist Son of a bitch...

Just cause I'm black with Braids that means I sell dope?? eat a dick clown...

Insight @ Apr 7th 2009 1:49PM

"Change your avatar."

Classy as ever.

Funny that you go around this site parading values that you ignore whenever you feel.

Beyond Good and Evil and games like it shouldn't be encouraged due to the way certain races are characterized

yet what you said, right thur, was perfectly okay?

uh

The Baron @ Apr 7th 2009 4:16PM

Bowser hates all races with equal intensity.

Bowser Rogozhin @ Apr 8th 2009 5:44AM

So wait a minute.

We have a guy openly discussing drugs, a black guy I might add, I point out the obvious, and I'm called a racist? Sorry, the hypocrisy is overwhelming. I'm going to lie down now...

...(an ellipsis, just for, sweetheart). You clearly know what the stereotypes are, yet you clearly cling onto them for dear life. Why discuss the topic in the first place if you understand the awful connotations associated with the black race? Why would you willingly conspire to reinforce negative stereotypes? Does it bring you joy? Well such ignorance brings me sorrow.

If you don't want a situation like this to emerge once again then don't resort to bringing down a whole race of people. It's not becoming and it's frankly embarrassing. And your reaction, your entire failure to see the irony of your statements compounds it all. Shame on you, Chris. Shame on you.

@artist formally known as Fatass

In Ancel's game, we have a situation where very clever men try to use myths and signs to propagate destructive sterotypes; here we have a very dull man using crude language to propagate destructive sterotypes. Chris is wrong, I'm in the right.