Formerly About Advanced Micro Devices Message Board

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Politics : Formerly About Advanced Micro Devices

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To: Scot who wrote (94546)	2/22/2000 10:39:00 AM
From: Joe NYC	Read Replies (1) of 1573841

My question/concern about the X-Box is simply...how is AMD going to make any money? The console could be priced as low as $149, including a hard drive. It seems like we are barely covering costs here, if that. I thought the reason why AMD was in the cpu business is the potential for significant margins. Am I off-base here? I don't know if MSFT is planning on any kind of royalty scheme from game publishers to subsidise the price. $149 seems low. Maybe $149 for hardware cost, plus $20 - $50 to MSFT for the OS plus $50 markup for final price of $250. Still, $149 for all hardware would mean no more than $50 to AMD. $50 would probably be still within a ballpark of profitability, but anything below that is going to be tough. But think of the upside: Athlon would become THE gaming machine. People would build (or buy) their own souped up Mega-X Boxes with the high end CPUs, and they will brag about how much higher their frame rate is than the other guy's. All the games would be optimized for Athlon and 3DNow and will run fine on X-boxes big brother - high end Windows 2000 machine. Joe

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