Microsoft Loses $126 Per Unit on XBox 360

ahess247 writes "BusinessWeek has taken a look at the insides of the XBox 360 and with the a little help from market researcher iSuppli determined that Microsoft is continuing its tradition to taking a big loss on the console in hopes of making a profit on games. From the article: "An up-close look at the components and other materials used in the high-end version of the Xbox 360, which contains a hard drive, found that the materials inside the unit cost Microsoft $470 before assembly. The console sells at retail for $399, meaning a loss of $71 per unit -- and that is just the start. Other items packaged with the console -- including the power supply, cables, and controllers -- add another $55 to Microsoft's cost, pushing the loss per unit to $126."

Cmon Modders

[panxerox]

Linux this baby.

Yeah, but they make it up on volume.

[sizzzzlerz]

Sell enough and the per unit loss approaches zero.

Die Microsoft!

[Anonymous Coward]

Let's all buy an Xbox!

Tell you what

[Paladin144]

Other items packaged with the console -- including the power supply, cables, and controllers -- add another $55 to Microsoft's cost, pushing the loss per unit to $126.

I'll make you a deal, Microsoft. If you send me 100 bucks, I won't even buy an Xbox.

$126 times 3 million units = $378 million

[voice_of_all_reason]

Billy Boy can probably look between the cushions of his couch and find more than that.

Microsoft has been out of the "making money" business for so long. All Gates really wants is attention at this point.

Only $126 ????

[zappepcs]

If it keeps crashing like a windows95 box, MS will lose much more than $126 per unit... pfft

Now's our chance!

[Shadow Wrought]

If you , me and 175,000,000 of our closest friends all but one this weekend, we'll bankrupt the buggers! w00t!

Re:You ever been to Wal-mart?

[Kierthos]

So an an exercise for the reader, how many 2-liter bottles of soda would it take to bankrupt Wal-Mart?

Kierthos

Comment removed

[account_deleted]

Comment removed based on user account deletion

Re:Selling The Hook

[GungaDan]

I am slightly amused at the concept of heroin dealers distributing syringes freely in hopes that people will come back to them for the drug. Or the neighborhood "greengrocer" handing out free bongs so people will come to him for something to put in them.

BTW - hello Sweden! I'm a big fan of your bikini team. ;-)

Re:Clever Marketing Campaign

[HTH NE1]

So all the Anti-Microsoft-geeks on slashdot will now run out to buy a console just to hurt Microsoft!

Still, you could have fun smashing it in public [smashmyxbox.com].

I have a cunning plan...

[sgant]

1. Buy 200 billion Xbox 360s.
2. MS loses 25.2 trillion dollars.
3. No one buy any games for these 360's so no royalties go to now bankrupt MS.
4. Port OSX and Linux to Xbox 360.
5. Network together all 200 billion 360s to make ULTRAMAX, the supreme overlord computer that controls everyones daily lives.
6. ??? (who knows what the future will hold then).

Let's get going on this people.

Re:You ever been to Wal-mart?

[hamburger lady]

if they can get people to buy the pop they are more likely to think, "Oh I think I should get X while I'm here."

come for the soda, stay for the ecstasy? sounds like a good business model.

This is definitely a scam

[Weaselmancer]

People just post these XBox money-loss stats to speed development on the Linux port. ;^)

Re:You ever been to Wal-mart?

[FuturePastNow]

You mean Sam's Choice Doctor Thunder costs more than 58 cents to make? Wow.

Re:I have a cunning plan...

[Omestes]

Don't tell that to Google, they might go and do that, it has all the right components. killing MS, knowing everything, and control!

The Linux Game

[Nom du Keyboard]

So why doesn't someone just make a licensed "Linux Game" disc for XBox. A lot of people would enjoy playing that, and MS would get royalities. And you could still play game discs on it too!

Re:I have a cunning plan...

[GeffDE]

7. PROFIT!!!!!!

Re:Selling The Hook

[aminorex]

Heroin and cocaine are demonized mercilessly by the ignorant.

While there clearly exist animalistic individuals who are devoid of self-control or rational planning capacities required to use heroin and cocaine responsibly, many of us find that these, like numerous other less vividly painted chemicals, are useful adjuncts in living rich and fulfilling lives, with high productivity, minimum pain, robust mental health, and good social relationships.

Re:Sony

[Rosco P. Coltrane]

Microsoft is a software company at the core trying to sell hardware. They never seem able to make any money at that, which brings to mind the phrase 'stick with your core competency'

Apparently that's what they're doing. [slashdot.org]

ooh!

[Greyfox]

I'd like to see someone buy 10,000 of these and superglue them together into a statue of a giant penguin! Maybe Google would have the loose cash and artistic vision to do such a thing?

Is that before or after you factor in the cost of

[crovira]

replacement for the house where the thing caught fire?

Just curious. I'd sooner Microsoft lost money big time with this little venture.

Re:Selling The Hook

[Tim Browse]

Atari was late to the game. I'm guessing that you weren't around in the Magnavox Odyssey vs. PDP-11 battles. Magnavox CREATED the market.

PDP-11 had superior hardware but their controllers sucked and didn't have the licensing that Magnavox had.

Magnavox Odyssey was THE console from 1 to 2 until Kerplunk then Atari vs. Intellivision battles began.