Microsoft will make a profit on every Kinect sold

Don Mattrick, head of Microsoft’s interactive division, has told the New York times that every Kinect unit sold will make a profit for the company.

Unlike the Xbox 360 or PS3 which were both originally sold at a loss to generate sales the Kinect is going to follow the WIi’s example and sell at a profit instantly.

The general consensus when the Kinect was released was that it was more expensive than expected and this would help explain why.

It also does point to Microsoft being less than certain about the success of Kinects software which is generally where gaming companies make their profit.

Only time will tell with the Kinect being released locally on the 10th of November, 6 days after the US launch.

Source: VG247

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Author:Gavin Mannion

I'm cranky, arrogant and ever so amazingly annoying but when you get to know me you will also realise I'm honest and incredibly good at describing myself... now pass me that beer

  • Fox1

    I don’t believe the 360 is being sold at a loss in emerging markets(SA) :devil:

  • RSA-Ace

    Accessories have never been known to sell at a loss. Usually that’s were money is made up.

  • http://www.lazygamer.net Gavin Mannion

    Well the 360 is now being sold at a profit all over the world (not sure about the new one though)….

  • Werner

    Well… at the price they are selling it, I would have been shocked if they made no profit.

  • Bobby Kotick for Dummies

    At that price (especially for a peripheral), you must really love your kids. :wassat:

  • http://www.lazygamer.net Gavin Mannion

    Maybe we spoil our kids but if I could get away with only spending R2k at xmas for the kids I would be over the moon….

    My secret plan is Kinect for the wife on her birthday with Kinectimals and Dance Central for the kids at xmas… then all the other stuff kids need now days

  • Bobby Kotick for Dummies

    like an ipad? Presumably, according to a poll conducted by Duracell, that was number one on their wishlists. Why kids would want an ipad is beyond me.

    It’s weird when I was 8 – 12, an action figure (be it teenage mutant ninja turtles, GI Joe or superman) or a bike would have done the trick.

  • AC!D

    Well hell cosidering Kinect is selling for R1035 in the States and about R1900 – R2000 in South Africa. This is almost a 100% mark up and would have been a 100% mark up if the Dollar was not so weak these days. Id say all the profits will be coming from South Africa :biggrin:

  • AC!D

    Its also funny to note that the Rand has gotten stronger against the dollar and yet the price of Kinect hasnt gotten cheaper. I say cheaper because the pricing was announced months ago and remained the same even with the weakening dollar. Whoever is distributing Kinect for MS in South Africa is one greedy bitch!!!

  • Bobby Kotick for Dummies

    Hear hear!

  • StigSmash

    To be honest it is not just Kinect. Look at the prices of bloody well everything?? Stronger rand should mean lower prices for consumers. I think the main reason behind it is that it take so long for these changes to actually filter down to the consumer. On the other hand when the rand goes to **** everyone is very happy to ensure prices are correct (and this is on a macro level and not micro)

  • bokka1

    I just hope Gavin’s wife don’t read his blog.

  • http://www.designwave.co.za Nick de Bruyne

    @AC!D – What I do know from dealing with distributors is that they usually agree to a certain price that remains fixed for a certain period of time. So if they did their orders on that fixed price, it will not change again until the new negotiations.

    Hope that sheds some light on the situation. I do however hope that we get a price drop soon, because the price of Kinect is ridiculous at the moment.

  • RSA-Ace

    They usually fix the exchange rate 25% higher in case of fluctuations. So if it’s R7 to the $ then they’ll work with R9 to the $. Then there is transport, insurance, customs etc… It’s actually quite easy to see how the price jumps so fast.

    Also remember there are 20 millions American’s with Xbox’s and less than 200k South Africans (complete guess).

  • Fox1

    The current price got fixed when the Rand was R10 to the dollar and oil prices were $160. That was 2 years ago :dizzy:

  • Bobby Kotick for Dummies

    Hopefully Wallmart brings balance to the force!

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