Kinect priced for profit

Xbox 360 platform holder Microsoft has claimed that it will be selling each 130 Kinect motion camera for a profit.

Speaking to The New York Times, Microsoft’s Don Mattrick claimed that the first ever prototype for the device cost $30,000 to manufacture and has in total cost hundreds of millions of dollars to develop.

That selling a product for profit is notable is probably true only of the games industry, which is famed for aggressively driving new hardware launches by selling the initial device at a loss. The thinking is then that profit can be found on follow-up sales of accessories and games.

The PS3 was famously sold at a loss for a considerable amount of time, and Microsoft’s games operations took years to get to the point when it was no longer reporting red numbers at the end of every quarter.

But let’s not forget that it was only in June of this year that UK retail was calling for a sub-100 RRP for the device.

Indeed, MCV still believes that as was reported way back in November 2009, Microsoft initially hoped to bring Kinect to market for under 50 – a number it fell far short of when revealing its final 130 RRP.

That the company in the end chose to raise the entry price but enjoy the luxury of profit is an understandable one. Whether or not it will be a costly one will be revealed over the next 12 months.

Kinect will be launched in the UK on November 10th.

About MCV Staff

Check Also

Technology and the market will set the cost of triple-A productions – it’s not an inevitable and negative escalation

The idea that the industry will stagnate because of rising costs is a historically flawed argument based on historical data