Forum M Nintendo-Wii-U-Console-Generic-Image

Published on April 8th, 2012 | by Mike Gwilliam

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Rumor: Wii U’s Total Bill of Materials Estimated at $180

Speaking with sources closely involved with manufacturing and distributing Nintendo products, the total cost of materials to manufacture the Wii U console (includes cost of controller) is estimated to be around $180. On top of this, our source tells us the controller’s total bill of materials and components cost no more than $50.

The source goes on to say that Nintendo is assessing the overall market and finalizing costs to determine the price for the Wii U, but it will be no less than $300 retail price when it launches.

According to our sources:

“Cutting production costs to maximize profits is Nintendo’s main concern with the Wii U. 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. “

The new NFC capabilities for each new Wii U controller costs no more than $5 to implement, and the prices of NFC implementation in mobile devices is expected to fall below $1 in the near future. Our source explained: “NFC capabilities are a drop in the bucket for Nintendo. As NFC becomes more mainstream in mobile devices, the price for NFC implementation will rapidly decline. Nintendo is jumping on NFC because of a projected cost decline in the technology.”

When we asked about the controller’s other manufacturing costs:

“The cameras in the Wii U controller are an estimated manufacturing cost of $6. They are slightly better quality than the 3DS and DSi cameras. The touch screen has a manufacturing cost estimated at $14.”

According to a report in 2010 by UBM Tech Insights, Microsoft’s Kinect cost$56 after tearing it apart and pricing each of its components. Microsoft charged $150 for the Kinect in November 2010. In comparison, the Wii U controller’s cost of materials would be slightly less than what Kinect cost when it was first released for the Xbox 360.

This wouldn’t be the first time that Nintendo has been under a pricing controversy. In 2011, the 3DS launched at $250 which seemed like a steep price for most gamers. The IHS iSuppli Teardown Analysis Service did a physical breakdown on the bill of materials and found that the cost of materials was no more than $100.71.

To be fair to Nintendo, there are many costs that can accumulate such as including software with hardware, R&D, shipping costs, marketing/promotion, transportation, packaging costs, and carrying/holding costs. When you add up all of these, you can see why game consoles can be priced so high. None of these costs were considered in the estimated $180 figure that our manufacturing source gave us for the Wii U’s bill of materials.

Nintendo-Wii-U-Console

“Nintendo chose an economical GPU and CPU that could keep up with the performance of today’s current consoles, but keep hardware costs down to maximize profits. Nintendo got a bargain price on the custom GPU and CPU that the Wii U uses. There is a bigger focus on downloadable content, applications, video content, digital distribution, and services to create a stream of revenue. Investors will be ecstatic with the news.”

Rumors have suggested that Microsoft and Sony might be dropping the prices of their respective consoles this holiday season to combat Nintendo’s Wii U. The 4GB Xbox 360 (without Kinect) currently retails at around $200 in most stores, and gaming industry analysts are predicting a price drop to $150. This also falls in line with reports that the next Xbox might be revealed and launched in 2013. If Nintendo chooses to go with price tag of $300 or higher, it will be interesting to see how the Xbox 360′s holiday sales will compare to the Wii U. Especially with Microsoft planning a massive ad campaign for Halo 4 this holiday season.

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About the Author

Mike Gwilliam brings you up-to-date reviews, previews and news about video games, the internet, and technology. He's bold, out-spoken and pulls no punches. If you ever had a reason to trust someone's opinion on a video game, Mike Gwilliam will tell it how it is. Whether it's a masterpiece, overrated, or just downright sucks, Mike will let you know. His favourite games range from Star Craft, Final Fantasy VII, Grand Theft Auto, and Skyrim to Zelda, Max Payne, God of War, Uncharted and Batman: Arkham Asylum. In addition to game reviews, he'll also preview upcoming TV series and special gaming events such as E3, which, he'll be going to in 2012.



11 Responses to Rumor: Wii U’s Total Bill of Materials Estimated at $180

  1. Not nice says:

    “Nintendo chose an economical GPU and CPU that could keep up with the performance of today’s current consoles, but keep hardware costs down to maximize profits. Nintendo got a bargain price on the custom GPU and CPU that the Wii U uses. There is a bigger focus on downloadable content, applications, video content, digital distribution, and services to create a stream of revenue. Investors will be ecstatic with the news.”

    Horrible news…

    • the_voice says:

      We already know what kind of GPU and processor the Wii U will have, so that bit isn’t “news” at all.

      For the record, the Wii U’s capabilities far outstrip what the X360 or PS3 can do.

      • TheRealThanos says:

        How’d you know?
        Most of that stuff is vague and based on rumours anyway, so maybe E3 2012 is the event to wait for to get some definite answers.
        I am however very interested in the chipset, so if you could shed some light on that, it would be mighty appreciated… (or post a link)

    • Benfiske says:

      This still fits that the wii u will have the IBM power7 and ati rumored gpu in it. A bargain deal means they are buying a bunch and probably got them for well under $40 bucks each. So it means its still very capable machine.

  2. ZanetheWise says:

    Interesting how the 3DS’s costs break down to $100 but Nintendo still took a loss per unit selling them for $180. As the article states, there’s a lot more that goes into manufacturing than just the cost of parts. Still, can’t wait to hear the cries of “Those greedy bastards!” echoing around the internet.

    I really hope they don’t cut too many corners. Early rumors indicated a noticeable (thought certainly not generational) step up from PS3/360. I hope that remains true, though, after the Wii (which they squeezed some impressive visuals out of all things considered) I’ll take what I can get. Just so long as the price reflects what’s there (and $300 sounds pretty reasonable to me) I’m down for a day 1 purchase.

    • Benfiske says:

      Nintendo doesn’t sell it for $180. They sell it to retails at a much lower cost, the retails in turn sell it at a msrp price if $180 therefore the retail makes the profit on the say (and in most cases the manufacturer does as welk but apparently Nintendo doesn’t yet) that is where the price disparage goes.

  3. Caleb Dutton says:

    no sources of what happened, because of this I WILL NOT BELIEVE IT, this is obviously troll bait from a professional

  4. TheRealThanos says:

    Just outta curiosity: should I read economical as ‘budget’?
    That would mean the console will get a very outdated chip set, which will be a shame, cause that would sorta mean that they’d follow in the Xbox’s 7 year old footsteps (because of the similar chipset/architecture and all… )

  5. Even if the WiiU is only comparable to the PS3 graphics wise, that’s not that bad. With Nintendo’s lower price points, and ability to make good games (Zelda), the WiiU sounds like a good thing. If they add decent storage on both the game disk and internal drive, and if the rumors are true that Microsoft and Sony are disabling used games, Nintendo is going to whoop some serious ass.

  6. TVippy says:

    Very interesting to see how the sales will stack up indeed!

  7. steve guy says:

    I didn’t know electronics were built for just the cost of the materials. Wow, that really does make this “controversial”, as you put it. How dare you Nintendo, pretending to have expenses outside of the raw materials of a product, when we all know now that these consoles are just spare parts shoved into a case by robots. Game journalism to the rescue!

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