Gizmodo reports Toshiba losing approximately $500 per A2 sold at $99

[Hussla]

Originally Posted by MallardRider

I hate to be a Toshiba shareholder right now. Wow, does Toshiba ever have logic with their A2 firesale. What is worse...I wonder how many will return their A2's.

Returns with problems wouldn't suprise me.

Lots of NON-TECH savvy users out there who simply DO NOT understand firmware updates and upgrades (this goes for both HDM formats) But my personal experience with Toshiba CE here in Australia including their HD-DVD players, the quality leaves MUCH to be desired.

It all seems so cheap and flimsy.

In Australia Toshiba released a PVR called the HDDJ35, so far it is one of the WORST pieces of consumer electronics I have ever sold. My store sold 20 and 20 were returned with problems and this was Australia wide. Numerous firmware updates, etc etc were required to eventually get SOME of the units usable otherwise most stores and shops refused to sell the item anymore. Toshiba HD boxes, offered great picture quality but in terms of usability were rubbish, prone to getting really hot, PAINFULLY SLOOOOOOOOW channel changing, their cheap made in China upscaling DVD players were crap, their Regza LCD's are horrifically overpriced and simply don't stack up against other companies offerings.

Toshiba is Japanese for crap ahah

[Hussla]

And as for giving away heaps of free discs, personally I am of the belief that it doesn't encourage people to go out and buy software. Why should they? then they got 7 FREE discs!

Give them no discs and the people may be more willing to purchase discs to go with their player.

I smell death......

[JohnAlden]

Well those hd dud players will be used to bring Rossie O' Donallld back from the dead in 2045.

[westend]

Well think about it. The A2's sold out within hours. Pretty much just fanboys knew about the sale, which means that a large percentage of them were bought by people that already owned a HD player, including some BD owners.

[Blu-Light]

Originally Posted by merrick97

Guys, I know we support bluray here, but do we honestly believe that Toshiba is losing $500 per player??? That number seems awfully high. Id guess that each player cost about $200 to make, but $500?

Um no.

These players were manufactured almost a year ago. You have to think of this in last year's dollars and manufacturing costs.

Add to that the costs to store and move. And of course you have the Paramount bribe and the 7 free movies.

Toshiba is BLEEDING cash on HD-DUD. The end is near.

[mystiksuicide]

Originally Posted by Manco

I'm shocked. Utterly shocked.

But delighted!!! lol

[Marcusarilius]

Originally Posted by westend

Well think about it. The A2's sold out within hours. Pretty much just fanboys knew about the sale, which means that a large percentage of them were bought by people that already owned a HD player, including some BD owners.

Bet the fan boys bought them as Christmas presents for relatives to help support the format for a while.

[Icemage]

Hold on. The original article is waaaaaaaaay off on its calculations.

My best guess estimate back at the beginning of this year was that the A2 was being manufactured (at that time) for somewhere in the vicinity of $250ish, maybe a shade higher.

We can't really use the HD-A1 bill of materials as a guideline because it's completely different from later generation models in terms of componentry and design - the HD-A1 is really a PC in a box. Toshiba has since rectified this little oversight in their design, and it wouldn't surprise me to see that their costs were at least close to $200 per unit.

Even so, they're still taking a bath on hardware as far as I can tell, especially at $99. That's money they'll never see from licensing.

My read of the situation is that this is Toshiba's "all-in" bid, to borrow a poker term. They know that without drastic measures, HD DVD is going to get hammered in sales this holiday season, and with it go their hopes of protecting their DVD royalties. Hence their willingness to lose nearly limitless amounts of money to prevent this from happening.

Whether their plan will work is anyone's guess. I personally think it's not going to pan out very well for them, considering that HD discs of both flavors are still double the cost of their SD DVD counterparts, and appealing to average consumers may persuade them to buy the hardware, but never the software at this point in time.

[What'sHD]

^^

That right there makes sense.

Toshiba wants a cut of royalties from BD (Imo) and will continue ruining the BDA party until it gets some such offer Or until the HDM(?) Biz Unit runs out of cash and the toshiba mgmt is unwilling to fund further.

[Sling]

Originally Posted by Icemage

Whether their plan will work is anyone's guess. I personally think it's not going to pan out very well for them, considering that HD discs of both flavors are still double the cost of their SD DVD counterparts, and appealing to average consumers may persuade them to buy the hardware, but never the software at this point in time.

I agree 100%.
Many that picked up that walmart special were buying standard DVD,s thinking it would be true HD in-turn getting upscale 1080i.Hd-DUDs focus is on the uninformed consumer dumping inventory .There actions will be there format downfall.
No worries Blu-ray camp..In my opinion this format war will be over soon.Sony is playing the right cards not degrading there product.

[Whyser]

Originally Posted by Sling

I agree 100%.
Many that picked up that walmart special were buying standard DVD,s thinking it would be true HD in-turn getting upscale 1080i.Hd-DUDs focus is on the uninformed consumer dumping inventory .There actions will be there format downfall.
No worries Blu-ray camp..In my opinion this format war will be over soon.Sony is playing the right cards not degrading there product.

.. and keeping in mind that only 50,000 players were manufactured...
that's barely a scratch in this market... especially if a lot of people are picking up DVDs to go with them lol.

It seems that a lot of people are doubting these numbers. Fair enough, I'm only sharing what I saw, and perhaps comparing the A1 to the A2 is not a reliable comparison.

but I still find it HARD to believe that the parts cost only $200. Are you saying that Toshiba would have had a little less than $300 profit margin (when they were originally selling for approximately $500 back in Nov/Dec2006 Jan2007)??

I'm going by WickyWoo's numbers of $325-$350 for just the parts. I'm still sticking by the idea that these costs DON'T include assembly, packaging, peripherals, software, storage, marketing, etc.

[Sling]

Ive noticed a few forum members getting scared and trying to pull the ..I may go neutral crap...That is very sad to say the least.

Toshiba's losing major money on there dump.Many of there consumers wont even buy that red label...They will be happy with upconvert and save that extra dvd buying money.Thats not the goal of High Def movie viewing.

Outcome,
There studio backers will wonder were there money is.They will Look at blu-rays high profits jumping off HD-DUD format backing blu-ray.
HD-DUD loses format war bottom line because of this and there's no way around it.

lets all get scared now lol lol lol

[What'sHD]

This is the end game, folks.

Hang tight, buy BDs and we can celebrate in 3 months or so... I reckon.