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Report: PS4 Cost $381 To Build

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A new IHS report states that Sony’s manufacturing cost for the PS4 was $381; just $18 shy of their retail price for the system.

This price is according to a teardown analysis of the system in which the following components are priced: AMD chip (350 square mm based off 28-nm tech) – $100; 16 memory chips – $88; Seagate HDD – $37; Marvell and Skyworks wireless chips w/optical drive – $28; DualShock 4 controller – $18.

“If Sony could build the PS4 for a lower cost it would do so, but if history is any indicator, it would also lower its retail price,” said IHS analyst Andrew Rassweiler. So in the end the profits are going to come from the games, PSN, and controller sales. “If your cost is within $10 to $20 of the retail prices, there’s very little chance you’re making a profit on the console.”

via AllThingsD

  • Dillon

    But you have to think how many of the components they bought at once… Bulk items are substantially cheaper than one off purchases. And do you really think Sony would allow for only a $20 profit margin on the PS4? You must be completely out of your mind.

    • http://Nerdacy.com/ Mansoor

      I believe those are the wholesale prices. Having little to no profit margin is actually quite common in tech; the companies profit on accessories and software sales. For example, DualShock 4 controller, PSN, and first-party exclusives. Remember that their original price for the PS4 was $499 until they cut the PS Camera and dropped it to $399.

    • Diego

      Not to mention shipping costs and lost property to theft and damaged ps4s.

    • Besserwisser

      PlayStation 3 cost more to make then what they sold it for. It’s an old and common strategy for tech…

  • Mike

    $18 shy of retail, but retailers aren’t paying retail to sell an item for zero profit.

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