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Comment by mbell | Hacker News Reader

> $99 for an Ouya is definitely selling at a loss;

I doubt that. $99 is probably just above cost with 1 controller, depending on production volume and how you factor in NRE. Generally speaking the big price break on electronics comes at 10,000 units which I imagine would be on the low end of their intended order given the number of backers already.

Most of the cost in mobile devices lies in the screen, battery, touch panel and associated circuitry. This device doesn't have any of those. A Tegra 3 SoC only runs about $15 in volume. For comparison, Apple sells the ATV for ~$100 and the original was reported to cost ~$64 to build, I don't have any data on the newer models but I doubt the cost has changed much, if anything its lower.

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They've had a number of opportunities to raise the price. They did an initial batch at $95, and then they've raised the cap on the $99 batch over and over.

At any time they could have not raised the cap on the $99 batch and opened a new one at $125 (for example), and they haven't done so.

So either they know $99 is a good price for their product or they're complete fools...

> This device doesn't have any of those

The controller has a touch panel and battery (pretty sure they're wireless).

> reported to cost ~$64 to build

Is that just the BoM or does that factor in manufacturing, QA, having to hold inventory, etc.?

> The controller has a touch panel and battery (pretty sure they're wireless).

True, however the issue is different from mobile devices. The battery in a controller is likely a standard off the shelf package, e.g. a pair of AA sized rechargeable cells. Mobile devices generally have a battery custom designed for the needed form factor. That custom design and production is very costly.

> Is that just the BoM or does that factor in manufacturing, QA, having to hold inventory, etc.?

It was a teardown by iSuppli, I can't find the original report now and I believe it was actually the Apple TV 2 not the Apple TV 1 as I originally stated, I forgot there was a huge Apple TV way back and was thinking of the ATV 2 as the original.

The price from iSuppli would be BoM + manufacturing. Manufacturing for a device like this is minimal per unit, just a few dollars and generally includes the factory level QA. For any run of decent size the electronics QA is done by a machine via flying probe or bed of nails setup, its very cheap on a per unit basis. The only manual QA needed would be checking out the packing for defects.

> Is that just the BoM or does that factor in manufacturing, QA, having to hold inventory, etc.?

Found the teardown: http://www.isuppli.com/Teardowns/News/Pages/iSuppli-Teardown...

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