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Consoles are sold at-cost to consumers, or sometimes even at a loss: https://www.pcmag.com/news/microsoft-loses-up-to-200-on-every-xbox-console-sold https://www

Consoles are sold at-cost to consumers, or sometimes even at a loss: https://www.pcmag.com/news/microsoft-loses-up-to-200-on-every-xbox-console-sold https://www.pcmag.com/news/microsoft-loses-up-to-200-on-ever... iPhones are sold at a _premium_. If iPhones were sold at-cost to consumers, then Apple would have been right to ask developers to pay 30% fees.

sureIy 2y ago
I think this is the real answer, however it would be difficult to use it as an excuse for the model since there are laws also against selling at a loss to undercut competitors.
- cyberax 2y ago
  It's a more difficult argument. Consoles are not competing with regular general-purpose computers, and the console manufacturers go out of their way to make it impossible to install unapproved third-party software on them. And since all the console manufacturers are selling the hardware at loss or with low margins, they can argue that it's just how the market works (free razors but expensive razor blades).
  - sureIy 2y ago
    > Consoles are not competing with regular general-purpose computers Yes but why? They very powerful computers. New recycling laws might force companies to give up the keys to the hardware before or after their obsoletion. The precedent here is SIM-locked devices. At some point you must let the user do what they want with it.
    - cyberax 2y ago
      Consoles have a surprisingly long commercial life, more than 5-7 years. So the usability of old consoles at the end of their lifecycle as a PC replacement is not that great. Might still make sense, though. Just for general historical preservation.
rk06 2y ago
If consoles are sold at loss to gain "monopoly power", then that is anti competitive and should not be allowed. This would lead (or maybe already resulted) to pathetic printer and ink cartridge situation
- cyberax 2y ago
  I'm ambivalent about consoles. However, for the consoles to make sense, they _have_ to be an oligopoly. There can't be 100 brands of competing consoles. The main feature of traditional consoles that would be lost in this scenario: guaranteed compatibility of games.
  - rk06 2y ago
    Why not? Game devs want to be compatible with multiple consoles. Users want games to be compatible to be with their console. So, who is causing this friction? Console companies. Now, there may be technical limitations due to games being such a unique kind of software. But at the end of day, they are software. Games can be packaged to support multiple formats or a standard interface.
    - cyberax 2y ago
      > Why not? Game devs want to be compatible with multiple consoles. Console games are typically highly optimized for particular console hardware. This coupling allows great-looking games for hardware that is cheap to make. As a result, it's typical for consoles to far outperform regular PCs of the same price range. Especially at the beginning of the console lifecycle. So it can be argued that consumers benefit from this arrangement: they get cheap special-purpose devices for gaming that can't be obtained if consoles are prohibited. > Games can be packaged to support multiple formats or a standard interface. Sure. But for AAA-type games that push the envelope, it's not at all trivial. However, it seems that this pattern is fading with the recent consoles. So perhaps they also need to be unbundled.

sureIy 2y ago

I think this is the real answer, however it would be difficult to use it as an excuse for the model since there are laws also against selling at a loss to undercut competitors.

cyberax 2y ago
It's a more difficult argument. Consoles are not competing with regular general-purpose computers, and the console manufacturers go out of their way to make it impossible to install unapproved third-party software on them. And since all the console manufacturers are selling the hardware at loss or with low margins, they can argue that it's just how the market works (free razors but expensive razor blades).
- sureIy 2y ago
  > Consoles are not competing with regular general-purpose computers Yes but why? They very powerful computers. New recycling laws might force companies to give up the keys to the hardware before or after their obsoletion. The precedent here is SIM-locked devices. At some point you must let the user do what they want with it.
  - cyberax 2y ago
    Consoles have a surprisingly long commercial life, more than 5-7 years. So the usability of old consoles at the end of their lifecycle as a PC replacement is not that great. Might still make sense, though. Just for general historical preservation.

rk06 2y ago

If consoles are sold at loss to gain "monopoly power", then that is anti competitive and should not be allowed. This would lead (or maybe already resulted) to pathetic printer and ink cartridge situation

cyberax 2y ago
I'm ambivalent about consoles. However, for the consoles to make sense, they _have_ to be an oligopoly. There can't be 100 brands of competing consoles. The main feature of traditional consoles that would be lost in this scenario: guaranteed compatibility of games.
- rk06 2y ago
  Why not? Game devs want to be compatible with multiple consoles. Users want games to be compatible to be with their console. So, who is causing this friction? Console companies. Now, there may be technical limitations due to games being such a unique kind of software. But at the end of day, they are software. Games can be packaged to support multiple formats or a standard interface.
  - cyberax 2y ago
    > Why not? Game devs want to be compatible with multiple consoles. Console games are typically highly optimized for particular console hardware. This coupling allows great-looking games for hardware that is cheap to make. As a result, it's typical for consoles to far outperform regular PCs of the same price range. Especially at the beginning of the console lifecycle. So it can be argued that consumers benefit from this arrangement: they get cheap special-purpose devices for gaming that can't be obtained if consoles are prohibited. > Games can be packaged to support multiple formats or a standard interface. Sure. But for AAA-type games that push the envelope, it's not at all trivial. However, it seems that this pattern is fading with the recent consoles. So perhaps they also need to be unbundled.