Whispers suggest Nintendo is close to putting a price tag on its new console, the Wii U, with a significant margin on manufacturing costs.
Forget The Box cites anonymous sources “closely involved with manufacturing and distributing Nintendo products” for a report claiming the total component cost of the Wii U hardware comes in at around $180.
The tablet controller is said to be worth about $50 on a component level, with the cameras costing $6 and the touch screen $14, while the addition of NFC technology like that used in pay-wave credit card systems is worth about $5.
The sources expect the final bundle to be priced at “no less than $300” at US retail.
“Cutting production costs to maximize profits is Nintendo’s main concern with the Wii U,” the source said.
“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 tipster also said Nintendo deliberately chose a cheap GPU and CPU on par with the PlayStation 3 and Xbox 360’s offerings, in order to keep hardware manufacturing costs down.
“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,” the source added.
As usual, it’s worth noting that the actual cost of producing a new console – which includes research and development, platform and developer support, packaging and beyond – is significantly higher than that of its hardware alone. An $120 margin would not necessarily represent a profit.
The Wii U is expected to be fully detailed with a launch date and price tag at E3 2012.