Why Is Xbox Series X So Expensive?

Released three years after its most recent predecessor, the Xbox Series X continues to take the world by storm since its release in November of 2020. Many gamers wonder why it is so expensive and whether it is worth the investment.

While it was actually listed at the same release price as the Xbox one X, the generation that came out most recently before it, it is actually far more expensive due to hidden costs, which we will address at the end of this post.

First, let’s look at the technology improvements and the other socio-economic reasons this console is so expensive.

Increased Cost Due To Updated Technology

1. Improved Heat Dissipation

You may have taken a look at the new console and wondered why it was so enormous, and why it was designed as a standing unit rather than the typical horizontal design. One of the reasons for the larger size is to accommodate the large grille on the top. This is there to improve heat dissipation by allowing more room to heat to escape.

In order to make this most effective, the unit had to be built standing up. This is because heat rises. So with the new design layout, and the thicker body, heat has more room to rise and exit the machine than it would have with the old shape.

2. Reduced Fan Noise

This goes hand-in-hand with the reduced heat dissipation. When the cards inside are being used, they get hot. And if they get too hot, the fan will have to work extra hard to keep things as cool as possible. The harder the fans work, the louder the machine gets. This can make it harder for you to hear the game or simply pull you out of the immersive experience, neither of which are desirable results.

By adding the extra room and design change to accommodate the heat dissipation grille, the fan noise is ultimately reduced as a result of the fans not having to work as hard. With reduced fan noise, you can remain immersed in the gaming experience more easily.

3. Crash-Resistant

Along the same lines, one big reason for games crashing is overheating of the internal mechanics. Another result of adding the stand-up design and grille, and reducing the amount of work that the fans have to do, is fewer to no crashes due to overheating. While crashes for other reasons may not be affected by this, if you have ever experienced heat-related crashes, you’ll be very happy with this improved design.

4. Twice the Graphics Power

While the previously-released generation had a graphics card with 6 teraflops of power, this one has an incredible 12 teraflops–double the power. Because of this major power boost, it can run games in 4k at 60fps.

The best an older model could do was run the occasional game in 4k. And oftentimes, you’d have to choose between 4k and 60fps, as using both at the same time was simply too much for the machine.

This new graphics card, however, can even run some games at 120fps. A huge improvement over the old console’s abilities.

5. Better Storage

The most recent older version could boast a one-terabyte drive, but it was a regular old hard drive. The Xbox Series X, however, has a one-terabyte solid-state drive. The difference between a regular hard drive and a solid-state drive is that reading and writing data can be done much faster no the solid-state drive. This means that your game will load faster in general and all the various aspects within the game will also load at lightning speed.

You can even pause one game, go play another game for a while, and then immediately return to the first game without having to waste any time waiting on loading.

Additionally, the XBox Series X comes with a dedicated proprietary drive port specifically for users to plug in an external solid-state drive to allow more room for more games, if needed.

Increased Cost Due To Current Events

While there have been many updates and improvements in the technology, there are also events going on around the world that are affecting the price of the Xbox Series X.

6. COVID19’s Effect on Gaming Habits

Since the onset of COVID19 and the increased number of people staying home, there has been a huge increase in the number of people regularly playing games and the number of hours people tend to play per week.

With newly remote workers no longer having a commute, kids staying home from school or for homeschool, and outside activities being reduced or done away with, people have had a lot more time at home on their hands. And many have turned to video games as an enjoyable way to spend that time.

Many people who were not serious gamers before have become avid gamers since, and spend more money on nicer, more updated equipment and games. And both those new to and familiar with gaming tend to play through games more quickly and subsequently get bored of them sooner.

As creators make more games, there’s a need not only for new stories and characters but also for improved graphics and speed to keep people entertained and hooked on playing for longer. So game design companies have invested in more and better games, and so console companies must invest in higher quality consoles.

These many increases in the demand for more and better games and newer faster consoles have all worked together to cause new consoles to be made and released. And everything new about them makes them more expensive.

7. Cryptocurrency Boom and Chip Crisis

The graphics cards that are needed to build consoles are also used in cryptomining, the process of making an income with crypto currency. With the shortage of chips over the last several months, fewer chips are available to be used to make graphics cards. This has driven up the cost of chip production, and in turn, graphics card production, ultimately leading to an increased cost of production of consoles.

If they can even be built at all. Because of the popularity of cryptomining, miners are grabbing the graphics cards up faster than the console producers can, which further drives up prices as the scales of supply and demand are tipped more and more.

8. Scalpers

Scalpers are people who buy up a bunch of items at their release cost and then sell them for a huge profit when slower shoppers go looking for the items and find that all the normal retailers are out.

We saw this when the price of toilet paper and sanitary wipes increased astronomically from private sellers early on in the COVID crisis. It’s the same with baseball tickets, Funko pops, and gaming consoles. The reason you may find many purchasing options for upwards of $600 on Amazon and through private seller accounts is because someone set up a bot to purchase as many items as they could as soon as they were released, and then held onto them for a little while. Then when all the regular retailers sold out, the scalpers listed their supply at an insane markup.

But people still pay those crazy prices if they want one bad enough. And scalpers make thousands off them.

There’s even a conspiracy that the console producers themselves buy up a bunch of their own stock or hold it back until the rest of the supply is sold out so that they can act the part of anonymous scalpers and make a larger profit per sale.

These assumptions are unconfirmed, but something to be considered.

9. The Global Shopping Situation

Yet another reason these devices are so expensive is because items that are built in one far-away place are having significant difficulty in getting shipped to another place. So parts for production besides graphics cards have been challenging to come by in a timely manner, which slows down how often more consoles can be released for sale.

And once those consoles are built and packaged, it could take any number of weeks or months to get them to their retail destination, with the shipping difficulties our world is facing right now. 

10. Supply and Demand

Ultimately, it comes down to supply and demand. Fewer consoles were able to be built initially, and so fewer have been released at a time. And the longer people have to wait to buy an available unit, and the longer they have to wait for the unit they were finally able to purchase to arrive at their location, the more they’re willing to pay to cut the wait time if they’re able to find a way.

Hidden Costs That Increase The Price of Xbox Series X

This also lets the console makers get away with a lot of hidden costs. For example, the All Access deal allows a gamer to purchase a subscription at a mere $35 per month and throws in a free Xbox Series X with a minimum two-year commitment. In 24 months, you will have paid $840 dollars, rather than the $499 release cost. The deal is worded to make it sound like you’re getting a steal, but it doesn’t actually include as much as it may lead you to believe.

Additionally, some games you already have for an older console won’t play on the new one. So you’ll have to buy more games–even some of the ones you already had before.

And you’ll need a new controller to go with this console, and potentially other items. This upselling is a common practice among product companies, but is very disappointing for their customers, especially for repetitive things like games and controllers you already own.

We wish you the best of luck as you determine whether the Xbox Series X and all its cool tech and extra costs are worth the investment for you.