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$249 3DS only costs Nintendo $101

Dale Weir's picture

Nintendo 3DS Image

There was a lot of debate over the final price of the Nintendo 3DS after its Japanese launch price was announced at ¥30,000. The debate got louder when gamers and journalists realized that equaled about $370.

Fortunately, no one really thought that would be the actual price but there was a lot more arguing over what the final price would be. Would Nintendo release the 3DS at the premium price of $300 or give gamers a break and release its machine for under $200?

Nintendo sorted all of that earlier this year when it revealed that the price point will be $249.99. That's better than $300, but many still questioned such a high price point.

Things get more interesting this week after UBM TechInsights' breakdown of the 3DS' internal hardware that was revealed by Eurogamer.net.

In it we learn that it costs Nintendo about $101 to assemble the 3DS. This means it is selling the new handheld for about $100 more than it might need to.

In Eurogamer's article there are a lot of analysts and retailers that are quoted as saying that the price is quite fair and practical. And reading their comments you have to admit it all sounds very logical.

But what do you think? Is $249.99 a fair price for a new iteration of the DS? Is the prospect of playing 3D without glasses enough of a hook to override the cost?

Source: Eurogamer

 

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Platform(s): 3DS  

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Does that price account for

Does that price account for R&D? Transportation? Advertising?

Economics 101

Howdy Dale,

I am a longtime reader of Game Critics and love what you folks are doing over here. This is one of the handful of sites that I believe is moving the conversation about games into thoughtful, interesting territory.

That said...

At the risk of sounding obnoxiously pedantic, I take some issue with your suggestion that Nintendo is selling the 3DS for "more than it might need to." Nintendo, like the vast majority of companies out there, is not a charity - they're a business, plain and simple. If the market supports a $100 plus mark up on the 3DS that is, from a business standpoint, precisely what Nintendo should charge for one.

There is no such thing as a "fair" price for a luxury/discretionary income product. Fairness and charity do not - and should not, I think - enter into that equation.

Nintendo is an interesting case in this regard. It is pretty well known that their policy is to turn a profit on every system from launch. In the technological arms race that is console gaming, this is pretty unusual. I knew they'd be in the black with every 3DS sold but I've got to admit, I'm surprised it is to the tune of 100 smackers.

The system intrigues me. Due to a variety of cirumstances - work, family, y'know, becoming an adult and all that - most of my gaming these last few years has been done on handhelds. My DS and I have spent a lot of quality time together.

But I'm gonna wait on the 3DS. Not so much because of the price, but because of Nintendo's history of iterative hardware upgrades. I'll hold out for next year's model.

What about you? Is your 3DS on pre-order, or are you playing the waiting game?

tpb

Nintendo can charge what it wants

I usually try not to add personal opinion into news postings like this one. If it came off that way then my bad.

I'm a capitalist. I believe something is worth whatever someone is willing to pay for it. It's likely that many people will pay $249.99 for the 3DS at launch (and many months after) and others might pay more on eBay if supply quickly runs out. I have no problem with that.

That said, that is a huge markup even if you consider the company has to recoup R&D and advertising costs. I think there are many that will take issue with that. And like I said in my post, there are many that have had a problem with the 3DS's price even before this Eurogamer news story.

Back to me: Like you I am going to wait. I think the 3DS is too expensive for what still looks like DSi tech; the $40-50 games don't look like they are worth the price of admission just yet; and I'm not a 3D fan either. Unless Nintendo does something amazing with its 3DSWare store, I don't see myself paying for a 3DS anytime soon.

Dale, Do you think gamers

Dale,

Do you think gamers are unique amongst hobbyists in the degree to which they become personally invested with games and game culture?

For myself, SEGA and "Street Fighter" are touchstones of (if not bywords for) my childhood. Not Marvel and DC; not a handful of cartoons; not the myriad of books I read - SEGA and "Street Fighter".

My first trip to Japan was as much a five-day nostalgia bender as it was anything else. I had honest-to-god tears in my eyes when I happened upon my first vintage games store.

I mention this only to suggest the way this sort of personal investment (and it seems, more often than not, to be largely motivated by nostalgia) might influence our perceptions of a game company's business decisions.

When Nintendo sells a 3DS for a one hundred dollar profit, that's good business. But I can see how long-time fans might bristle at this. And dont even get me started on the bile and ire I reserve for SEGA when it comes to their unwillingness to release a proper follow-up to "Phantasy Star 4". (Those online games - fun as some of them might be - absolutely do not count.)

With gaming - or, more accurately, for a subset of people who game - it would seem the guts and heart take precedent over the ol' noodle.

What do you think?

tpb

Right, but...

Nintendo has always been about the profit. The N64? Reasonably cheap to make, even though it was based on a costlier, outdated cartridge going forward. Gamecube? Cheap. Wii? Pure profit from the beginning.

They're a smart company because they always plan for today, not tomorrow. Instead of introducing extremely expensive, cutting-edge technology (and no, the glasses-free 3D is not new technology) and charging an early adopter fee in order to recoup even part of a big loss, they aim low and charge moderately. They don't count their chickens before they hatch--something many, many other console makers have failed to do (Atari, Sega, Sony, etc.).

In terms of everything except online infrastructure, it's gone pretty well for them.

I agree that the system isn't worth $250; not yet, anyway. We'll see.

I've pre-ordered mine

I've pre-ordered mine through Amazon (which is offering a $25 game credit bonus). As Dale said, market forces dictate prices otherwise Gucci handbags would sell for $20. My family is due for a new DS as my son is spending more time on mine (he'll inherit my DS lite). Having the DS backwards compatibility makes the 3DS a sensible DS upgrade in that regard. It's not uncommon to see families with multiple DSes. This is where Nintendo absolutely gets their target audience.

Trying to determine the value of the 3DS based on the immediate lineup of games doesn't quite jive with me. When buying into a platform, I also factor in the vision Nintendo has for the platform and the legacy of systems that came before. While I was disgusted with the way Nintendo ultimately guided the Wii, I've owned every Nintendo portable system and hopefully that won't effect the direction they've maintained with their portables.

I have to admit...

...while the 3D effect for games sounds very cool, the minute I saw screenshots for the 3DS, I was sold simply because Nintendo finally put some muscle behind their hardware. Granted, it's no NGP (which I will probably buy), but the tech backing this portable feels a bit more current.

To me, the DS always felt like the SNES/N64, but existed during the GameCube/Wii era. Now, the 3DS looks like a Gamecube/Wii, so thoughts of a new Metroid-vania or Contra title make me weak in the knees. I think I just rhymed. A little.

Overall, 3D could be awesome, but I'd buy in just for a DS with some visual muscle. Which this is. Also, my only DS was a DS Lite, so I'm due for an upgrade.

the PARTS cost $101, it

the PARTS cost $101, it takes a bit more money to actually get the thing on shelves and to the customer while allowing Nintendo and retailers to actually make any money (and how dare a business try and do that).

remember when it came out that Kinect only cost like $55 in parts? similar difference here. the components for an iPad are also much less than what it retails for. hardly news on any of this but it does seem to be an emerging hobby within the gaming press to question everything Nintendo does these days.

Its 2 DS"s ductaped together

Its 2 DS"s ductaped together and the price reflects it, its nothing more than a DS XI with forgettable 3D attempting(and headache inducing) technology, I am much more impressed with the PSP2, last go around while the DS was gimmicky it was less haphazard as this thing is. Oh sure it will sell well buts a god damn joke, I might could hold back my spew age if they put in a real battery but no...this is some bottom barrel tech makes the PSP look like a frakkin PS2.........

The PSP...

...does look like a PS2. Already.

Sakilla wrote: ...does look

Sakilla wrote:

...does look like a PS2. Already.

More like a PSX with AA, I play my PSP on the TV via component cables. Tho from what I see the 3DS is closer to the PS2 than the PSP. But no TV out an emulators will catch up fast to running it.

hmm

Chi Kong Lui wrote:

While I was disgusted with the way Nintendo ultimately guided the Wii, I've owned every Nintendo portable system and hopefully that won't effect the direction they've maintained with their portables.

Other than the original Game Boy, I've also owned (and sold) every major iteration of their portables. I got screwed on the first Gameboy Advance, which was awful. I got screwed on the first DS, which was heavy and awkward to hold (not that the Lite was much better). The 3DS hardware is already getting mixed reviews. Is it really worth it to be an early adopter when you 1.) have a DS, 2.) the system costs $250, 3.) the launch titles are almost uniformly awful, and 4.) a better version of the hardware is probably 1-2 years away? I'm not so sure. It usually takes hardware a second try to get it right. PS2? Slim was a big improvement. PS3? They cut the backwards compatibility, but the slim uses less power and weighs far less. 360? See aforementioned PS3-slim improvements.

Ditto for Neo Geo CD, PSOne, PSP, and so on. Very few of the successful consoles don't get at least one major hardware update. With the iPhone and iPod, it took until the iPhone4/current iPod to get hardware that actually lived up to the price. Usually, I'd be right there with you in the early adopter camp, but I'm not so sure anymore.

I can live without the 3DS right now, and probably for the forseeable future. That's why I canceled my preorder. NGP: day one purchase. I think the system design and tech is impressive enough (at least from what we've seen so far) that it will warrant the inevitable $300-400 price tag.

And if the long-fabled Wii HD ever comes out, that will be a day one purchase for me as well. God knows both the Wii and its library need a second look from Nintendo.

Re: hmm (3DS launch)

Matthew K wrote:

Other than the original Game Boy, I've also owned (and sold) every major iteration of their portables. I got screwed on the first Gameboy Advance, which was awful. I got screwed on the first DS, which was heavy and awkward to hold (not that the Lite was much better). The 3DS hardware is already getting mixed reviews. Is it really worth it to be an early adopter when you 1.) have a DS, 2.) the system costs $250, 3.) the launch titles are almost uniformly awful, and 4.) a better version of the hardware is probably 1-2 years away? I'm not so sure. It usually takes hardware a second try to get it right. PS2? Slim was a big improvement. PS3? They cut the backwards compatibility, but the slim uses less power and weighs far less. 360? See aforementioned PS3-slim improvements.

What you're saying makes perfect sense from a consumer stand point, but as a gamer, that means you'll sit out the first two years of every game system since they *all* get a hardware revision at some point or another. All consoles launch with pretty abysmal lineup of titles as well. The PSP launched with issues that were arguable worst than that of the 3DS. Was that something you bought close to launch day and is so, why?

What I find interesting is that people who decided not to purchase the 3DS feel the need to over rationalize that decision over issues that aren't unique to the 3DS. If anything, Nintendo deserves the greatest leeway when compare to the 360's Red Ring debacle and Sony's anti-consumer media standards (mem sticks, UMD, Atrac, Blu Ray).

While it seems like we're not going to find common ground on this one, I found every Game Boy hardware flaw acceptable given the benefits of longer battery life, costs and true gaming portability. I also was on board for each revision in terms of costs to adopt, what it improved and how it was spaced out relative to the original hardware release.

Regardless of hardware revisions and relative costs/price drops, what it comes down to is whether or not a gamer is confident that the system can produce several killer-apps to justify the purchase and that's never been a problem with me when it comes to Nintendo portables.

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