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Fils-Aime: Wii Console Profitable At Launch

While it has become customary for console manufacturers to sell the hardware, at least initially, at a loss, comments made by Nintendo of America president and chief oper...
While it has become customary for console manufacturers to sell the hardware, at least initially, at a loss, comments made by Nintendo of America president and chief operating officer Reggie Fils-Aime indicate that his company's upcoming Wii platform will be profitable from day one. "We will make a profit on the entire Wii proposition out of the box -- hardware and software," Reggie Fils-Aime told Reuters. "That really is a very different philosophy versus our competitors. We are a company that competes only in the interactive entertainment space so we have to make a profit on every thing we do." Nintendo announced earlier today that it will launch the Wii next-gen console in North and South America on November 19 for a retail price of $250, as compared to the Xbox 360, which retails with two separate SKUs at $299 and $399, and the upcoming PlayStation 3, which will also sell as two separate versions for $499 and $599. The statements by Nintendo mark a stark difference from what the industry has come to expect. Earlier this year, competitor Microsoft revealed that its Home and Entertainment division, which includes the Xbox 360, lost $388 million for its third-quarter on $1.06 billion in revenue, though this loss represented a sharp increase from the $175 million loss the previous year. Fils-Aime added: "We are a company that competes only in the interactive entertainment space, so we have to make a profit on everything we do."

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