A new report claims that the Kinect costs only $56 to produce, making Microsoft's profit margin with the $149.99 retail price look downright Apple-like.
Back in June, Microsoft unveiled its new motion gaming device at E3. It was one of the most hyped demonstrations of the event, and shortly after Microsoft revealed Kinect’s pricing at $149.99.
Sure, this definitely throws Kinect in at the “reasonable” price range, especially given that Microsoft’s rumored manufacturing costs were the same amount. However, an independent report that came out today argues otherwise.
A report by EETimes claims that it costs approximately $56 to create a Kinect unit, which could suggest that Microsoft is pocketing that extra $93.99. Before jumping down anyone’s throat, however, remember that Kinect’s prototype was extremely expensive. Microsoft told The New York Times it cost $30,000 to construct the original model, and it’s also rational to assume that the company invested a considerable amount in the research – after all, bringing this kind of technology to home gaming is pretty revolutionary. And of course, there is the alleged $500 million Microsoft allotted for advertising.
Regardless of Kinect’s cost versus its worth, it will remain a hot commodity. And on another note, right now you can make it pay for itself and then some. Hacking the device to link it to other systems is quickly becoming a trend, and former Google engineer Matt Cutts just announced $2,000 in prize money for innovative ways to hack Kinect. So anyone devastated by the possibility of being oversold on the it, start hacking away. And if you haven’t bought one yet, you’re in luck: The report lists all the components you need to make your own $56 Kinect.
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