120GB HDD pricing analyzed and it's overpriced
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Reader Comments (Page 3 of 3)
5-08-2008 @ 9:03PM
refinedsugar said...
Everyone should know how the game is played by now. They take losses on the actual hardware, but there is major money to be made in accessories, licensing and peripheral add-ons. It's been like this from day one, nothing has changed in that respect.
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5-09-2008 @ 7:54AM
Josh said...
Ya it might be overpriced, but is it overpriced compared to the $99 20GB HD? An extra 100 GB for $80 is reasonable to me looking at what the 20GB costs...
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5-09-2008 @ 8:40AM
digitarius said...
As others have said, You and I can buy a 120GB drive for $70, right now on Newegg. That's not even shopping around.
Microsoft will be buying these in bulk, probably directly from a solid partner like Toshiba. This means that they bypass whatever markup Newegg is making and get a price break for volume.
The casing materials, at the scale they are produced (Mostly interchangeable with the regular HDs, I'd imagine) cost probably on the order of a dollar a piece. Maybe. Another dollar (rounded up!) for the retail packaging.
Freight is handled in a super efficient manner, too. Microsoft generally will ship these to a few distribution centers and wholesalers who handle it from there. Major chains pay very little (Even with rising gas prices) because they buy in bulk, break down the quantities to what a store needs, and ship that using their own trucks or a contractor.
I'm thinking that $50 is a solid guess as to how much this thing costs to make. Lets be super-duper pessimistic and say that the cost of Freight to get it into your local Circuit City costs another dollar a unit.
What's left? Markup, baby. The lions' share of that will be taken by the retailer, but Microsoft will gouge on it since this is an accessory product.
Then you've got the other spreadsheet-monkey costs, the cost for retail space, the employee stocking it, the employee ringing it up, etc. And then there is marketing, but this product has zero specific marketing. The 360 line marketing is all it needs. So lets be pessimistic and say that it costs a whopping $60 all told.
How much is it retailing for again?
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5-09-2008 @ 11:03AM
Merehorseplay said...
Microsoft trying recoup losses on its hardware failures. Does anyone really need a 120GB drive? I keep most my TV shows and arcade games on live anyway and download them when want to play them, or just buy an extra 20GB drive on Ebay $20. thats what I did and I still haven't used it.
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5-08-2008 @ 12:31PM
Outinthedark said...
What a waste of $20...