Here’s Why the Nintendo Switch (OLED Model) Price Is $50 More Expensive

Besides the obvious upgrades to the Nintendo Switch (OLED Model), a new report suggests its $50 price increase is in part due to Nintendo decision to "test new waters for console makers."

As reported by Bloomberg, Nintendo's bet on the Switch (OLED Model) and its increased price follows the COVID-19 pandemic where Nintendo, Sony, and Microsoft have had trouble meeting demand from those looking for "entertainment and escape" while being isolated at home.

Speaking of the Switch, it has secured the top-spot on The NPD Group's list of best-selling hardware by unit sales in the U.S. for over 30 months straight. The PS5 and Xbox Series X are also doing very well, but Sony and Microsoft simply can't make them quick enough.

Nintendo is hoping this momentum will stay strong with the Switch (OLED Model) - which retails for $349.99 as opposed to the standard Switch's price of $299.99 - and the move follows the launch of the PlayStation 4 Pro and Xbox One X as a mid-life refresh that gives a console a breath of fresh air that isn't quite a new generation. However, the new Switch has one main difference from these consoles - it makes no performance improvements.

There are upgrades to be found in the Switch (OLED Model) of course, including the titular OLED screen, more internal storage, and other added components like a new console stand and a LAN port in the dock, but this is hardly the "Switch Pro" many were hoping for.

Despite that, Nintendo is looking to increase its profit margins with this new Switch model. The OLED display is said to cost an additional $3 to $5 per unit, according toe DSCC co-founder Yoshio Tamura. Increasing the internal storage from 32GB to 64GB looks to add another $3.50, according to Omdia's Akira Minamikawa. All the other new components are "thought to add a few dollars more."

All of these add up to around a $10 increase in price per unit for Nintendo, meaning it will gross around $40 per Switch (OLED Model) sold.

Nintendo had already been selling its hardware at a profit since its launch in 2017, and this would just increase its return via those who wish to purchase or upgrade to this new model. This line of thinking goes against the grain of the traditional console cost model that usually sees systems selling at a loss and recouping the initial investment through software sales and increasing manufacturing efficiency over time.

According to Ace Research Institute analyst Hideki Yasuda, if this move by Nintendo is successful and it is able to keep it impressive sales streak going, it "could set a precedent for charging more across the industry."

An official inside the PlayStation division shared that Sony is one of the companies keeping a close eye on the sales performance of the Switch (OLED Model), as the PlayStation 3, 4, and 5 took the traditional route of initially selling at a loss.

Investors aren't quite convinced yet, as Nintendo's shares have dropped roughly 5% since the announcement, and only time till tell which side is right.

“Nintendo failed to provide enough added value to justify a $50 bump in the new hardware,” Morningstar’s head of equity research Kazunori Ito said. “The new hardware is barely half-baked and would do no help at all in sustaining the platform’s momentum. The Switch had its peak last year and is only going to slow down from here.”

Others see it in a more positive light, like Serkan Toto, an independent consultant for video game companies. They said that the Switch (OLED Model)'s screen is good enough to "squeeze $50 more out of consumers" considering how well the standard Switch has been selling.

“I don’t see any reason why this model would flop,” Toto said. “Nintendo raised the new model’s price as it doesn’t need to cut prices for current models thanks to strong demand.”

With console sales usually seeing a decline as they get older and the effects of the COVID-19 pandemic wear off, some believe demand for products like the Switch may finally see a decline. However, Nintendo is never one to play by the rules.

“Nintendo made a real bold decision because it’s obvious that people would spend more on services and less on goods going forward,” Sony Financial Holdings senior economist Takayuki Miyajima said. “From a macroeconomic viewpoint, the move couldn’t be made if they have even a slight concern on how well the console would do.”

We won't have to long to find out the answer, as the Nintendo Switch (OLED Model) will be released on October 8, 2021. For more, check out our hands-on preview that compares this new model to the original .

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Adam Bankhurst is a news writer for IGN. You can follow him on Twitter @AdamBankhurst and on Twitch.