I had mentioned a while back that Nintendo would be taking a $50 hit if they sold the console at $299-349.
The reason for that is the hardware components. They didn't mess around this time.
The cost isn't brought down by lack of a DVD drive. The system actually has a Blu-ray type drive, but it doesn't authenticate Blue-ray movies or decode them. BD drives are not expensive at all for an OEM anymore, esp without the "bag of hurt" playback licensing.
(also, forgoing the hard drive still swapped for small SSDs. While that may not save much in the way of money, it saves much in the way of wattage.)
For this season of available hardware at various cost, they did the most they could while making sweetheart deals with OEM manufacturers (ensured by loyalty over the years, assurance of massive sales, and the good publicity that comes with a "design win")to ensure they had a very powerful system while at the same time ensuring a mass market point of entry.
the problem with that is the gamepad. It added a decent amount of cost to the system and Nintendo had to offset that while avoiding a Wii type situation, hardware wise.
In Japan, they pay full price. In the U.S. we get a subsidized console as Nintendo eats some money up front (new for them starting with the 3DS). But we aren't locked into contract etc. The "subsidy" comes via game purchases. by the time a Wii U gamer purchases 3 games, Nintendo is in the black again. Especially when some games like the launch Mario game cost far less to make that true next gen games. That's also why Nintendo assured itself of a high game tie-in by having so many games available for launch and why they needed to contract ubi to crank 'em out like crazy.
Most Wii U owners will probably get Rayman, Mario, Zombi U, and at least a port game or two during the launch window.
Boom. In the money again.
Then, when the AAA games come out specifically taking advantage of Wii U hardware, many millions of sales again.
By doing this Nintendo assures themselves of being competitive in the long run, of having a large install base to sell to, and of having a sure profit.
That's why it's so laughable when some try to misconstrue the fact that the system has ported games on it that barely look better than the systems those games are made for.
The reality is that Nintendo has added power back into the equation and they have done everything possible to ensure that we buy it and that we buy many many games for it, which we will enjoy due to the fun factor, the graphical prowess, and the uniqueness (until the competition create knock offs) of the gameplay greatly enhanced by the gamepad.
Edited by Socalmuscle, 01 October 2012 - 10:35 AM.