xbox 360 vs PC

I know there are a million of these threads and PC is better, but I'm not looking for a comparison. I was just curious why the 360 is cheap (relatively), while getting the same performance from a PC and way more expensive ?

 

that is absolutely true. first off- all the components are conceived with the understanding that they want the "cheapest gaming machine possible"

intel processors are really good at doing a lot of things- where as the processors in the gaming machines are really only good at rendering related calculations.

the cpu's are a LOT slower than the one in your pc. even though the sony one has 7 cores and the xbox one has 3, and yours most likely has only two. its still faster. the cpu in your pc is created with the intention of being fast at a LOT of different things, not just assisting the gpu in rendering calculations.

the operating system you pay for is also more expensive in a PC. it is made to do more than just be "the cheapest gaming OS without anything else" possible. think about all the things you can do on your pc. that is thanks to the OS.

the same applies to ram (you get more in pc's to support lots of different functions, running multiple programs at one time that each require moderate amounts of ram) and several other components.

the motherboard is made to be customizable. you can swap out processors- video cards - etc. the console mobo is made to be as cheap as possible while supporting whatever equipment they put in it. or in the case of laptops- the mobo is made to fit the components in a small a space as possible. either way- pc's are made with a more expensive design - with more of a consideration towards being either modular or portable than cheap.

plus- PC's generally are sold with the most current hardware, which you will pay a premium for. xbox360's are mostly the same regardless of when you purchase it. at this point, and xbox360 is using very old parts- and those parts will get older and older, cheaper to manufacture, and yet still those components will be in the xbox360.

a big part of the price has to do with the massive amount of units they are able to sell. oh and- you can only buy xbox360 software, which costs $60 a game, and several of those dollars return to microsoft.

in summary. its because of these things.

1- primary concerns are budget and ability to render graphics, rather than portability, modularity, top shelf hardware, or ability to perform non-gaming tasks. this is true not only in the hardware- but also in the operating system.

2- they are able to push a massive number of units. the more you can mass produce, the more you can sell, the cheaper it is to sell each unit.

3- software is restricted. you can write software for osx or windows, and apple/microsoft doesn't get any of that directly. the software for gaming consoles is expensive, and you are FORCED to buy it to get ANY functionality out of the machine. part of the cost of the software is dollars going back to microsoft.

 

No.

This is absolutely true. Console makers lose money on every console they sell. So the Jedi007 is entirely correct; an xbox 360 may cost literally half as much as a PC with the same graphics capability. But when you buy a PC, the PC maker is making a profit off you - not so when you buy an xbox (or a PS3, or a Wii).

They make their money off the games for the system. If you want to make a game for the xbox 360, you need to go to microsoft and say "Here's some $$$, let me make my game for your system" (or something equivalent), and microsoft will then make some $$ off every game sold.

That's how they make money.

 

I'm sorry I don't mean to nit-pick but as far as I can tell, Nintendo actually make profit on every one of their consoles that they sell.

 

yeah. you could be a very productive pc user and pay almost nothing for software.

plus- i just created a system on newegg with budget being a primary factor that would outperform a $299 xbox360 for only $349 after $50 in rebates. it would be really hard to make a system any cheaper.

athlon 64 x2 3600+ (i swear by the fact that its faster than the xbox tricore cpu, despite only have 2 cores)

pci x16 - ati x1950 pro 256 megs - again beating out the custom x1800ish gpu on the xbox.

2 Gb ram - cheap ram, but ultimately quantity is more important than quality with ram. especially on budget. that 2Gb will go way further than the shared 512 gpu/system ram. "shared ram" isnt that bad a thing (like it would be on a pc) but still you can call it about 256megs of ram vs 2 Gb for the system, and then 256 megs of ram for the video card in both systems.

cheapest case, keyboard, mouse, mobo, pos power supply (not good, but its the price you pay for not paying a high price) - plus the xbox 360 has a crap power supply anyway.

neither machine comes with a monitor that also takes out a chunk of the price.

80Gb hdd. Dvd/cd rom (reads only). i think you get the idea.

approximately $399 - $50 in rebate = $349. it would outperform either the expensive or cheap xbox. (hard drive size doesn't affect performance) - and if you wanted you could add some cost and get a MUCH larger hdd, and still end up under 399 after rebates.

actually yeah nintendo makes the largest profit on each of the three console manufacturers. because their parts are even MORESO budget oriented. behind that fancy case is a cardboard gpu. no joke.

microsoft makes a little bit of money on consoles at this point (i think you can see why- if you can assemble your own pc that outperforms an xbox at the same price point, then imagine the discount you get when you buy several million units...)

sony is still losing a little bit of money its consoles i believe.

of course, as stated above, a lot of the reason that they sell hardware is to entrap you to buy their software.

 

Yeah, thats correct.

 

Yeah, I guess they do... $92 on each Wii. They're weird. Doesn't necessarily mean I was wrong about console makers making most of their money off game licenses...?

I just did a quick google search on this. If you scroll down, you can read how much $$ they're all making for each console sold

 

cobalic, you are right that a large amount of the money they make are direct results of the games they sell. x dollars go back to the console maker.

however, you are just plain wrong if you don't think that mass production of the entire unit doesn't help to reduce cost.

have you ever gone to newegg, and wondered why it is cheaper to buy a processor/motherboard combo than it is to buy those parts separately? hmm...

and i will mention that i made a typo, i meant "the cheaper it is to make each unit" - or in other words, the price per unit manufactured decreases the more you manufacture them.

i can prove it. the very first xbox360 was very expensive to make. they had to design, argue, make decisions, redesign, debate more, alpha test, beta test, etc, and all the while, massive dollars are going into technology and salaries and wages. plus, when that xbox360 is finished, they have to set up all of the infrastructure required for mass production. MASSIVE cost. the cost of that xbox360 was not even within a few orders of magnitude to the price you pay for one off of the shelf. lets call it a billion dollars. i dont know the exact figure, it could be even more than that.

now take the second xbox360. all of the cost in design is not present with this particular machine. the cost is just the cost of parts and labor now. the design is done. lets just call the first xbox360 a billion dollar project. you just went from a billion dollars per xbox360 to 500.001 million.

build a third xbox360 and now its just over 333 million per unit.

a fourth unit brings the cost/unit down to 250 million.

combine that trend with the large decline in cost for parts over time, and a small decline in labor as the manufacturing process is smoothed out, also over time. - (both of these declining trends require that you continue manufacturing)

historically, console makers only lose money on consoles near the beginning of its life. xbox360's are currently profitable alone (just selling the hardware earns microsoft a few dollars). this was not the case when they were introduced in 2005. its also important to note that this doesn't relate to the real profit. the fact that they are making a few bucks (like $7 or something) on each machine they sell today doesn't mean that they have made a profit on hardware. for every unit they sell today and make $7 on, im sure there are multiple units they sold in the past that cost them $70 or more to sell. a majority of their money comes from software sales.

STILL- you can see that the more units they sell, the less it costs to make and sell each unit. over time, they reduce their losses on hardware and eventually profit from the hardware alone.

i hope i drilled that into the ground.

 

I have to disagree... do you work as an engineer?
I agree the market price might not be influence by whether if it is mass produced or not but i do know that the cost will drop if you go mass.

 

I guess I should clarify. Yes, the price will go down if you mass produce, but that isn't the way Microsoft makes a profit off the xbox. That's how Walmart and Costco do it, and the profit margins are tiny. Microsoft makes a lot more with the licenses.

 

it has nothing to do with resale.

reduction in manufacturing cost for the xbox360 means more total dollars in microsoft's bank account at the end of the day. minimizing cost to sell the hardware (or even turning that business into its own profit) is a huge deal. its a business, after all. a dollar is a dollar, regardless of whether it comes from minimizing a loss or maximizing a gain. and the fact is that there is a huge change in the cost to manufacture the hardware over time.

definitely the purpose of the hardware is just a platform for software. its all about the games, when all is said and done. but to microsoft, reducing hardware cost 100 bucks / system is probably just a big a deal as $10 commission on 10 games.