The latest Wii U rumor claims that the console/controller combo contains $180 worth of parts, $50 of which resides in the tablet-like controller (meaning it's no iPad or Kindle Fire). But once Nintendo calculates labor, marketing and other costs, the machine will cost anxious gamers no less than $300 at retail. The news arrives by way of the typical unnamed source who prefers not to be identified.
"Cutting production costs to maximize profits is Nintendo’s main concern with the Wii U," the unnamed source reports. "They are cutting costs in the Wii U’s hardware to build back confidence in investors. Nintendo wants investors to view Wii U as a less risky proposition."
That shouldn't be surprising given that investors really didn't want another console in the first place. They made their feelings known last year during the Wii U's big reveal at E3 2011, saying that Nintendo needs to invest in the mobile market instead. But Nintendo prime apparently doesn't agree, indicating through various reports that it has no mobile plans outside the current Nintendo 3DS.
But to make the wallets of investors happy, Nintendo is working to reduce costs and maximize profitability. What will this mean to end-users? So far developers are painting a bleak picture, reporting that on a graphic level, its output doesn't even match the current levels of the Xbox 360 and PlayStation 3 -- and it's supposed to be a next-generation console.
But Nintendo has dismissed any kind of inferiority, claiming that its focus is on gameplay as seen with the original Wii console. "We do not focus on technology specs," a representative responded. "We understand that people like to dissect graphics and processing power, but the experience of playing will always be more important than raw numbers."
So far the Wii U is slated for a 4Q12 release, so we'll have to see where exactly Nintendo cut corners. Meanwhile, the unnamed source said that the console will eventually become cheaper as the price for NFS implementation rapidly declines. As for the cameras in the controller, they supposedly cost Nintendo around $6 and are "slightly better quality than the 3DS and DSi cameras. The touch screen has a manufacturing cost estimated at $14."
The Wii U controller’s cost of materials should be slightly less than what Kinect cost when it was first released for the Xbox 360, the source added.
Last year Nintendo came under fire for the 3DS, as a breakdown determined that the cost of materials was no more than $100.71 USD. AT the time, the console retailed for $249.99, supposedly providing the company with a huge profit. But as ForgetTheBox points out, there may be other costs involved including software, research & development, packaging costs and more.
As we've seen in the past, we'll likely not see the Wii U as a stand-alone console during launch. Instead, retailers will sell pricey bundles which will drive that $300 pricetag up above the $500 range. This is where Nintendo will really racks in the big bucks thanks to over-priced software.