Friday, November 12, 2010

Kinect Didn't Cost Microsoft Even $60 To Make

This is all I'm going to say. F you Microsoft and your $150 price tag.

Ok. That's not all I'm really going to say. But reading that the Kinect only cost roughly $56 to make, that's a giant slap in the face to the consumers. Microsoft will be making just under $100 for each Kinect sold (not including retail fees...I'm going to estimate that they probably sell each Kinect to retailers at $129.99-139.99 with a requirement that the item sell for $150 at stores. I'm making this estimation based off of how hardware is generally sold to retailers, having worked at such a location and seeing the numbers a multitude of times. Hardware tends to sell to retailers with a higher price due to low returns. Otherwise systems would cost $100-200 more. However, games are cheap to reproduce on discs, so it's easy to sell low to retailers with a higher dollar value pinned on the customers. ) Way to stick it to your customers.

Now the article does point out the benefits to such cost effective technology designed by PrimeSense Ltd, Texas Instruments, and an array of other companies. It can make future products, such as picking a movie from you DVR, a simple wave of the hand at an affordable price for just about anyone. That's the good. The $150 price tag is the bad. Now I see why Microsoft was ok with spending $500 million on marketing.

Is it wrong that I'm hoping there is a massive slide in sales and this becomes a Black Friday/Cyber Monday/Christmas Eve doorbuster deal for $79.99? I will laugh meniacially.

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