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Iwata: Nintendo Doesn't Expect To Sell 3DS Below Production Costs

Unlike competing video game hardware manufacturers, Nintendo typically makes sure that it sells its video game hardware at or above production costs, and the 3DS is no exception, said Nintendo CEO Satoru Iwata.
Unlike competing video game hardware manufacturers, Nintendo typically makes sure that it sells its video game hardware at or above production costs, and the 3DS is no exception, said Nintendo CEO Satoru Iwata in an interview with VentureBeat. "I have to refrain from talking specifically about the price point," Iwata said. "What I can confirm is that, in terms of the production costs, it will cost more than the costs for the Nintendo DS today." He added, "Having said that, we believe we will produce enough value worthy of the production cost. We do not think we have to sell the products below cost." The 3DS boasts a 3.5-inch top screen that uses the latest parallax barrier technology to display a 3D image without glasses. Other features include a Pica 200 graphics core process from Japanese hardware firm DMP, three camera lenses, two of which enable 3D photos and a second 2D touch screen. Nintendo has remained quiet on a release date and price for the 3DS. When the original DS launched in North America in 2004, it retailed for $150. One analyst said that a $199 price point for the 3DS "is the best bet." Typically, video game hardware manufacturers sell consoles at a loss, and make up for those losses through the first- and third-party sales of high-margin software. For instance, supply chain analyst firm iSuppli estimated in 2006 that for the $499 PlayStation 20GB model, Sony lost over $300 per console. iSupply found in December 2009 that Sony reduced per-console losses to just $37. Iwata also said that the 3DS is not a response to Apple's popular iPhone or iPad. "It was not our goal to [create the 3DS as an answer to Apple], but if people think that, it is the result. We never try to think in terms of any competitive product or company. If you do that, you just focus on a certain narrow area."

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