Microsoft Xbox One vs Sony PS4

We have seen the arrival of both next-gen consoles, the Xbox One and PS4. These machines are built to revolutionize the gaming experience. Since they are very new and the demand is sky high, both the Xbox One and PS4 won’t come cheap. So how much are Microsoft and Sony earning for every console sold?

The PS4 has a price tag slightly above $400. For every PS4 sold, Sony makes on $18. As for the Xbox One, the profit varies. The hardware cost for Microsoft’s latest console is about $457. The manufacturing cost on the other hand is $14. Adding them together will get a $471. This is the wholesale price of an Xbox. However, the Xbox One is sold at $499 on retail stores. That gives a profit of $28 which is $10 more than Sony’s PS4.
However, the retailers must want a cut for selling the Xbox One. On top of that, there is the delivery cost and other miscellaneous fees to consider so that’s why it varies.

Both Sony and Microsoft are not expected to make a profit on the next-gen consoles. Both adopt a business strategy to land their machines on as many homes as possible. So why do it if it only means losing your money?

As for Microsoft, they will get their profit from other sources thanks to the Xbox One. They will focus more on getting royalty on games and feed on the Xbox Live subscription charges. The same goes for Sony. However, since Microsoft has made the Xbox One an all-in-one home entertainment system, future devices like the Televisions and smartphones can all be connected through the console.

We might see an Xbox One app being made available for a small fee soon. So is that $10 difference a big deal for both companies? Answer is no. Both Sony and Microsoft will see their profits coming from other sources thanks to their next-gen consoles.