Teardown reveals Xbox One costs $90 more than PS4 to make

Research firm IHS reveals combined cost of parts and manufacturing for Microsoft's console to be $471, compared to $381 for PlayStation 4.

Image Credit: AllThingsD

The combined costs of parts and manufacturing for the Xbox One comes out to roughly $471, almost $100 above Sony's PlayStation 4 ($381), according to a teardown report from IHS revealed by AllThingsD. The Xbox One sells for $499, while the PS4 goes for $399.

At least $75 of the $471 comes from the Kinect camera included with every system, the IHS report concluded. It features chips from Samsung and STMicroelectronics as well as a mysterious chip used to emit infrared light.

IHS was unable to determine the maker of this chip.

The single most expensive item, however, is the Xbox One's $110 AMD chip, which is around $10 more than the PS4's AMD chip. "They're both very powerful chips," IHS analyst Andrew Rassweiler said. "You might call them a gaming console on a chip."

The Xbox One's DDR3 memory chips stem from SK Hynix and came out to about $60, around $28 less than the cost of the PS4's higher-end GDDR5 memory chips. The system's all-new controller, featuring Wi-Fi and Bluetooth components from Marvell Technology, costs about $15 and sells for $60.

Unlike the PS4, the Xbox One features an external power supply, which costs around $25 to create, the report found, adding that the headset costs $10 to make and $14 to assemble.

Notably, Texas Instruments is a major parts supplier for the Xbox One, with six parts total in the system (four in the console and two inside the Kinect).

Because the Xbox One manufacturing cost is just $29 under its sale price (not to mention retailers taking their own cut of the retail price), Microsoft will look to software and services to post a profit. The reduction of manufacturing costs over time will also benefit Microsoft.

The PS4 and Xbox One have each sold 1 million units so far.

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Eddie Makuch

Eddie Makuch is a news editor at GameSpot, and would like to see the Whalers return to Hartford.
550 comments
gamefreak215jd
gamefreak215jd

Honestly and with due all respect for both the fans of Xbox and PS,I think that both the consoles kinda screwed up a bit this time,in terms of hardware.During their their time both the PS3 and the Xbox 360 managed to push gaming to entirely new levels.Very few PCs at that time could handle games the way an Xbox 360 could.Eventually PC did mange to beat both the consoles,in terms of graphics that is.I was actually hoping for the same to happen once more.The Xbox One who have really been better if MS would have focused on further improving the GPU rather than adding that stupid KInect.AMD kinda failed this type.Hopefully later on both the consoles might get superbly optimized games.

Kinguard73
Kinguard73

So you really ARE paying nearly 100 dollars extra for the Kinect =)

PHOENIXZERO
PHOENIXZERO

GG on MS for having an APU that costs more to produce yet is significantly weaker than the PS4's. You gotta imagine that there's a lot of people at MS who regret going the DDR3/ESRAM route (ESRAM is the reason why it costs so much thanks to it increasing the size/transistor count of the APU) and locking in their hardware design so early.

Sony got really lucky with GDDR5 and the density increases while MS got screwed since DDR3 isn't going to get much cheaper (costs of it have actually gone up thanks to a fire at a Hynix plant) and with DDR4 coming very soon DDR3 is teetering on being obsolete. GDDR5 is still going to be used and still has room for densities to increase and in turn more room for prices to drop as well.


Oh and Kinect though if the parts costs are accurate MS would lose even more money dropping the price by not including Kinect with the XBO. Sony is in a ridiculously good positition against them it's a bit of an amazing turnaround from this err last generation.

Undertow207
Undertow207

Xbox One cost more to make, yet has inferior hardware to the PS4. GG Microsoft

thekey
thekey

Which ever console gets the exclusive games people want, will be the winner!

deadpen
deadpen

Does anyone else feel they could have allowed the ps3 style charge cable instead of changing the connection size? But this was better than the Xbone, when I opened it and found AA batteries I felt as if it was 1989 with the added change of the battery port so you can't reuse them. Then both not allowing you to use headsets from the systems before is a kick in the teeth. Bottom line on controllers, the ps4 feels better (even though I can never find the start.... I mean option and select..... uumm share buttons on the fly) then xbox moving the 4 main buttons closer for the fatter lazy gamers so they don't have to move their thumb very far.... Oh sorry xbox said they moved it closer to make you a better gamer.... oookkkayyy. 

deadpen
deadpen

Must be the 10 LBS of extra plastic they used in it!

DeanoFantasy
DeanoFantasy

Regardless how how anybody nip picks at the new consoles, I honestly think the PS4 is the freshest console to grab this gen, New console interface compared to the PS3, and a brand new pad with new features on it etc just makes the console different from anything else I'm going to experience within games this gen, I might pick up an Xbox One later next year if any games interest me,.

sakaixx
sakaixx

higher cost point also meaning no price cut for a while for potential buyers

valium88
valium88

It is worth mentioning that the average yearly salary in China where the PS4 is assembled is $7,676. In Brazil where the XBONE is assembled the average yearly income is $10,268, that is almost a $3,000 variable, that has nothing to do with better hardware.

conphot100
conphot100

Texts instruments? I'm sure I had a speak and spell toy made by them when I was a kid. And they're producing parts for the x1. ROFL

Warmijwilf
Warmijwilf

lol at all the Microsoft and Sony fanboys in the comments section, both dissing each other's system, shouting as loud as they can as if either console is truly "better" than the other, and trying to get noticed. They're both good, just enjoy whatever console you bought and stop trying to make others feel crap about their purchase decisions.

Also I wish people would stop spreading falsehoods about either console.

jdt532
jdt532

So even without Kinnect the XB1 still costs a little more to manufacture than the PS4? This is despite the fact that the PS4 has more capable chips and more expensive RAM. M$ just fails at efficiently producing a console...

GH05T-666
GH05T-666

Xbox one has  'a mysterious chip used to emit infrared light.

IHS was unable to determine the maker of this chip.'

its a spy chip

BoozerX
BoozerX

Make it with appletards in mind.

Sponsored by PRISM.

ojplay
ojplay

Interesting.

Take away Kinect and PSU costs and it is about the same.

nVxx
nVxx

ok, 471-75 is 396, which is still more than 381, so X1 without Kinect is more expensive than PS4 despite lower specs.
non-optimal architecturing?

willjohnboy
willjohnboy

The mandatory kinnect is the main difference in price  as well as the size of the outer shell of the console

willjohnboy
willjohnboy

Lets not forget people that sony gets a small amount of cash back for every Xbox one sold due to Microsoft using a Blu ray player

VakarianGirl
VakarianGirl

Now here's a question:  If Microsoft used Texas Instruments, does that mean that more of their production funds went back into the US economy?

Dannystaples14
Dannystaples14

@gamefreak215jd That is the good thing about the new architectures. They can throw together games for the launch and lets not lie some of them look superb even now. Yet they are barely optimised due to tight launch deadlines.

When they actually start optimising them it will only get better.

This for me is in fact one of the things I hate about PC gaming. PC gaming gives a lot of freedom to developers to make great looking games. Yet they hardly ever seem to optimise anything.

The only game I've ever felt was very well optimised was Bioshock Infinite. It looked great and it ran perfectly on my laptop. My not at all top end laptop at that as well.

Games like Witcher 2 are beastly to play and normally it is because they are either CPU heavy (only use the CPU) or they are GPU heavy (only use the GPU), if they actually took a leaf from the consoles' books and started utilising everything at a computers disposal, people like me who only have laptops could probably play any game out, and we wouldn't need new expensive hardware, every four or five years to keep up.

But they don't, they just keep making games that require a top end GPU because the games are so badly made you NEED that amount of power to brute force your way through the crap coding.

Though on saying that I bet Nvidia have a lot to do with it.

p3rrypm
p3rrypm

@PHOENIXZERO That's only the GPU piece, the CPU is significantly stronger and the ESRAM helps a lot too.

Kinguard73
Kinguard73

@thekey How it went for Beta versus VHS and God knows how much better quality Beta was which proves Idiots do indeed have more money =)

santinegrete
santinegrete

@thekey trying to spread tolerance on this site? Blasphemy! F**K U!

lol jk, sorry I had a heavy week.

Manatassix
Manatassix

@deadpen 

Sounds like my Ex wife… Boom Boom! 

;P

jotalandia
jotalandia

@valium88 average without standard deviation. !!!! that's not how science works, your conclusion means nothing.

kemo88
kemo88

@valium88 It is also worth noting that the population of China as of this year is approximately 1,384,694,199 people compared to Brazil's approximate population which is only 200,674,130 people.

p3rrypm
p3rrypm

@conphot100 And Texas Instruments made personal computers 15 years before Sony ever thought about a PlayStation.

Manatassix
Manatassix

@conphot100 

Dude… um I would advise not repeating that comment to any more people than you have to… maybe deleting it?

Just some friendly advice, an informed and intelligent person it alas does not make you appear :/

Kinguard73
Kinguard73

@jdt532 I think what really failed was everyone who bought an Xbox One regardless of the tons of warning people saw early on from them. This just told me I made the right choice choosing PS4 all around.

Tao_and_Zen
Tao_and_Zen

@GH05T-666 It's probably the same chip they use in airport scanners to peek under clothing.

p3rrypm
p3rrypm

@ojplay It's less but, MS is a little gun shy after the heat issues with Xbox 360.

Kinguard73
Kinguard73

@nVxx Indeed. Kinda makes you walk up to Xbone fans and just straight out laugh at them. Even with exclusives down the road their games can't be as good as PS4 spec wise.

kennythomas26
kennythomas26

@willjohnboy Sony does not own the rights to the Blu-Ray tech that is owned by BDA ( Blu-Ray Disc Association ) which is made up of 9-10 associated companies and Sony does not have nor ever had any full owner ship of the tech.

p3rrypm
p3rrypm

@VakarianGirl Yes it does because the company is an American company and they're publicly traded so, yes some of that money does go back to Americans and American Stock Holders.


They're diversified for their manufacturing though and much of it is outside of the USA.

Manatassix
Manatassix

@VakarianGirl 

Nope the company is just named Texas instruments from the look of it. Their actual manufacturing plants aren't in the US, which makes sense as they would have to pay significantly more for no improvement in quality… 

Unfortunate side effect of manufacturing plants moving to countries like Brazil and China where pay is much lower and human rights are less protected… thats just business in the global economy sadly.

sadface1234
sadface1234

@Dannystaples14 @gamefreak215jd you have a point (GLARES at total war 2 release),  but am still with gamefreak on this one. I cant see either system keeping up if they want the generation to last 8 years like Ps3 and 360. With the consoles are on a x86 architecture making it easy to port from PC to console and vice versa that includes the optimization. Nvidia's Titan is already 3 times more powerful then the PS4 GPU in terms of teraflops... in 5 years how are current consoles going to keep up with the performance of PCs when they are already way behind in my mind (with xbox further behind then PS4). This is why i am looking very interested to see what Valve does with the Steam box.

Dannystaples14
Dannystaples14

@Kinguard73 @thekey Didn't beta max have a top loading slot though? I'd imagine that played a big part when everyone owned massive equipment like they did back in those days.

Hell my grandparents still own some old sound equipment, takes up like about a quarter of the room all on its own. If you are then have no choice but to put the Beta with clearance above it, that sucks.

Like when I play my PS1 now, you can't put anything on top of it because you need space above it to get games into it. Makes it seriously limited.

Dannystaples14
Dannystaples14

@Undertow207 It doesn't matter who the devs are if the devs make shit games.

Even the best developers can make shit games. They can't all be like CD ProjektRed can they?

Manatassix
Manatassix

@kemo88 @valium88 

In other completely irrelevant news.. I just did the biggest Doozie in the toilet… it was like THIS BIG 

*waves hands around like an idiot*

:)

strandny
strandny

@SphinxDemon 

Which PC are you talking about. At least my 5 year old laptop and 8 year old desktop are not that good as PS4 or Xbox One.

p3rrypm
p3rrypm

@Kinguard73 @jdt532 Unless Sony goes bankrupt now that they're 4 months removed from having their company withdrawn from the Nikkei Index and is now considered just Common stock. 


The companies stock is listed at $20.54 or 2,472.5 Japanese Yen and it dropped almost 4% since the beginning of the year.  If it gets under $2 it will be delisted and will have no open channels for investors...  Not long after that, the company will likely file for liquidation and bankruptcy protection.  


The good news is you will likely have a Chinese company that owns your PlayStation brand but, what could go wrong there?

jayd02
jayd02

@kennythomas26 Thank you.  I hate it when people think this happens.

Another fun fact is Microsoft is aloud to join BDA but they choose not to.

kennythomas26
kennythomas26

@jayd02 @kennythomas26 I also believe Sony was/is in a lawsuit with LG about the Blu-ray thing. I watched the Pach-Attack on my the gametrailers app and he said the same thing, but I thought he mentioned they joined this year maybe I heard wrong and if they aren't Microsoft is/are close partners with Samsung right.