OLED Switch: The official announcement of the OLED Switch was quite frustrating for Nintendo fans who were expecting a “Pro” model of the handheld console. But the disappointment wasn’t just because the console doesn’t bring any performance boost, but mainly because its price is US$ 50 more expensive. Market analysts now assess that this considerable increase was made aiming at a higher profit margin and could end up becoming a trend in other consoles if the OLED Switch is successful.
Nintendo is a very closed company and doesn’t talk about the details of manufacturing its products and its market plans. But estimates from professionals in the field calculate that the small improvements brought about by the new Switch model should not add up to more than $10 in the increase in production cost per unit. This approximate value takes into account the new OLED screen, the increased storage capacity to 64GB, and minor changes to the console stand and new dock connections.
If the estimate is correct or close, this would result in an increased profit margin of about $40, with minor changes to the notebook. If the OLED Switch maintains the success that the original model had been doing, it could impact the entire industry.
changing the game
It is common practice in the console market to release video games by losing money and then recovering in game sales and services. Only later in generations do video games themselves start to make a profit, with their production costs falling over time. That’s what Sony is doing with the PS5, for example.
Market analysts reckon that, if Nintendo can prove that it can be profited from the launch of new consoles, other manufacturers should follow suit. We even have unofficial information that Sony is already closely following the performance of the OLED Switch.
Nintendo is betting on the popularity of its brand and the high demand driven by the pandemic to cash in on its new Switch. There are predictions that agree with the manufacturer’s position, while other analysts estimate that the console will “flop.” The verdict will start to be evaluated from October 8th, when the OLED Switch will start shipping to its buyers.