The OLED Nintendo Switch Model Costs Just $10 More to Produce
According to a recent report by Bloomberg, the novel OLED Nintendo Switch costs just $10 more to manufacture compared to the old model. It’s impossible not to be taken aback by such a peculiar bit of information.
This means that the OLED Nintendo Switch is nothing but an attempt to sustain the hype and momentum, an ingenious business decision geared towards maximizing profits during a time when millions of gamers across the globe seek refuge from reality during the ongoing COVID-19 pandemic. Nintendo still isn’t ready to reveal the oft-rumored Switch Pro, so they’ve decided to create something akin to a “makeshift” — a console that’s supposed to sate the demand (at least ever so slightly). Increasing profit margins is the name of the game (to no surprise), but it’s still mind-blowing that the OLED model — which is superior in many important ways to the original Switch — costs just $10 more to manufacture.
Let’s Break It Down
The beautiful 7″ OLED display costs between $3 and $5 per unit (supplied by Samsung). What about the internal storage (doubled from 32GB to 64GB)? It’s just $3.50, according to an industry insider. The altered dock, built-in kickstand, and included LAN port are all just a couple of dollars in total.
Unlike Sony and Microsoft (who’ve been selling consoles at a loss), Nintendo’s Switch has always been sold at a profit, and that’ll continue to be the case for the foreseeable future. The OLED Switch, in particular, will increase its margins even further.
Moreover, by having three distinct models in circulation, Nintendo can more easily target three different demographics and segments of the market. They don’t have to cut prices because they’re still struggling to meet up with demand.
Quite an enviable position, all things considered.
Investors, however, aren’t all too impressed. Additionally, Nintendo’s shares went down by 5% once the announcement was made last week. Analyst opinions, on the other hand, are all over the place. For some folks, these small quality-of-life improvements were all they wanted. For others, there’s still a lot to be desired. Regardless, even if demand tapers off soon, Nintendo hasn’t invested much in this rather superfluous update, so it’s not like they’re at risk of losing any considerable amount of money.