This is all just my personal view and insight into the matter so I could be very wrong.
In only 17 posts!
Man, you'd have to be a complete moron to think the Xbox360 was going to be killed right now. Even if Microsoft were in the red, they could (and would) hemorrhage money until the end of time if it meant eventual dominance in a marketplace. This isn't even worth a point-by-point rebuttal.
October 26th, 2006 - Sony's Q2 profits decrease by 94%
October 28th, 2006 - Sony president Ken Kutaragi said he expects the PS3 to be capable of running games at a stunning 120fps
October 30th, 2006 - PS3 will push Sony $1.71 billion into the red
October 31st, 2006 - Japan launch of the PS3 is cut to 80,000 units
So what i got from reading this entire thread was that people jump to some huge conclusioned based on rumors, hearsay, and internet rable. I posted the "math stuff" because it kinda jumped at me that fiscal year 06 and Q1 07 was a 1.5 billion loss for MS, but just fiscal year 06 was a 1.71 billion loss for Sony. Yet no one is saying Sonys doomed, or that its there last console.
I've always looked at it like this. Microsoft put the xbox out there to get there foot in the door, not to compete. It ended early because of whatever, be it the nvidia thing, or just wanting to be first with something bigger and better. The second console was made to compete in a very tuff market with console lifespans expected to be five years plus. Hell Sony has said 10 years for the PS3. So less than two years in theres a hardware revision that lowers there production cost, and fixes all those ocassional red rings. With 3 years left if not more on an average life span, its not unreasonalble to assume with the glaring issues fixed, they cant just sit back and make money.
This is all just my personal view and insight into the matter so I could be very wrong.
Time will tell.
in the span of like 2 posts.
Sorry let me clarify that. I heard talk that the 360 division will take a dive in sales next year because of the competition with the other two consoles. The ease they have had being the only next gen console on the market is now not on there side. What I said after was my own personal view on why I think they might do even worse then that. Sorry if I was not clear when I wrote that.
Well, it has been competing with the two other consoles for the last 6 months and sales have been consistent. The Wii's been selling out everywhere. How much more competition do you want it to give?
But there is another ....
but you'd have to be a bit of a fanboy to predict the $600olol machine is gonna come out of nowhere to, not only outsell, but completely wipe the 360 off the face of the Earth.
This will be my last contribution to the thread as I don't particularly want to gfet drawn into a debate that is rapidly becoming a farce, but consider how much money Sony Computer Entertainment and Nintendo have made since November 15th 2001 and compare that with the amount that Microsoft Xbox Division has made.
That just drags out his insanely irrational point! Let's just talk about how Mario would totally kick Master Chiefs ass or vice versa!
Ranced on
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Vicious_GSRDudePrincipality of ZeonRegistered Userregular
edited July 2007
I am not a fanboy.
However the fucking legion of doom (the millions of PS2 owners who have not moved to a new console yet) seem to be quite big fanboys to a certain brand. I caught Michael Pachter saying once that he thinks all the PS2 owners were waiting for a price drop before they start getting PS3s.
However the fucking legion of doom (the millions of PS2 owners who have not moved to a new console yet) seem to be quite big fanboys to a certain brand. I caught Michael Pachter saying once that he thinks all the PS2 owners were waiting for a price drop before they start getting PS3s.
For sure, when the PS3 gets down to 200 dollars, millions will sell. The question is, when will Sony be able to get it that low?
I heard on the streets that with that speculation you have to assume that those millions represent fanboys from the internet and they aren't apart of the 80,000 a month who are buying the thing already.
I caught Michael Pachter saying once that he thinks all the PS2 owners were waiting for a price drop before they start getting PS3s.
Michael Pachter is an analyst. He generally either says the obvious, or he says something retarded.
The Atari owners didn't move to whatever numbered Atari that Atari was pushing during the time of the NES. A lot of the NES owners moved to the Genesis. Many of the SNES owners then moved to the Playstation instead of the N64. I see no reason to believe that the masses that bought the PS2 are loyal to the PS2 brand name.
“Warcraft is so good and so good-looking that it got this immediate attraction; everybody who would ever consider playing an online game said, 'This is the one. I gotta try it.' And what'll happen is inevitably, like the health club model, after you pay your 30 bucks a month for 3 or 4 months and you only go once a week, you realize it's not worth it and you split. That's what will happen with Warcraft ... I think it's going to roll back to a million. I'm not predicting it's going to happen in three weeks; I'd guess it has a half-life of 6 months to a year,”
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RoshinMy backlog can be seen from spaceSwedenRegistered Userregular
But then what about all those announced '08 games?
Star Wars: Force Unleashed, Dark Sector, Alan Wake, and Castle Crashers off the top of my head. Where will I go for my fix, oh wise seer Vicious?
They are 3rd party games, I also doubt Microsoft would want people to know the console is going to die. They would want to make as much money as they can while keeping consumers in the dark.
But you just said they were losing money. If they really are deperate enough to bin the Xbox, because they're not making a profit, wouldn't they want to do that as soon as possible..?
Roshin on
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syndalisGetting ClassyOn the WallRegistered User, Loves Apple Productsregular
edited July 2007
Man, I sure missed a lot of stupid in this thread today.
Yeah, i don't think we need to worry about the stability of Microsoft in the gaming industry. Their commitment to the platform and Live is pretty fucking solid, and they have spent far too much money on future interests to just drop it after a couple years.
The only reason the DC died young is because the well ran dry. All of the gaming divisions losses over the past six years can easily be covered via one good quarter's profit for Microsoft; it's not like this is seriously impacting them, and they seem to WANT to have a leadership position in the market... so yeah.
I remember how everyone said the xbox was a stepping stone into a MS developed Windows PC... or how they were going to drop the product in 2003, or all of this other shit.
It is as silly as Nintendo being Doomed, or Sony packing up and ditching the PS3. Nobody is leaving right now; all three are here to stay for the forseeable future.
PAX?
syndalis on
SW-4158-3990-6116
Let's play Mario Kart or something...
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jungleroomxIt's never too many graves, it's always not enough shovelsRegistered Userregular
edited July 2007
I have, for some reason, created both a hilarious monster and a meme.
I'm still waiting for vicious to do a 'eat my cock' swear.
Because honestly, after reading most of the thread, I would love to see him put his manhood on the line. The Xbox360 looks to be doing fantastically well, at least from the consumer's point of view, and cancelling the entire console division just does not seem very sound.
I mean, why would Microsoft cancel their console division just as they are starting to get out of the red?
On topic: I never thought X07 as necessary, it's just another small E3 esque thing for the Xbox 360, hopefully they can put in the extra resources they saved to improve on the software on the 360.
The Xbox game console is hot, but its division has lost $4 billion in four years and isn't yet in the black. The mobile-software division, also losing money, has just a sliver of the market for cell phone handsets. Microsoft Business Solutions, after acquiring Great Plains Software for $1.1 billion and Navision for $1.4 billion, is supposed to deliver $10 billion in sales by 2010. At its current 6% growth rate, MBS will attain that goal in 43 years.The Xbox game console is hot, but its division has lost $4 billion in four years and isn't yet in the black. The mobile-software division, also losing money, has just a sliver of the market for cell phone handsets. Microsoft Business Solutions, after acquiring Great Plains Software for $1.1 billion and Navision for $1.4 billion, is supposed to deliver $10 billion in sales by 2010. At its current 6% growth rate, MBS will attain that goal in 43 years.
But the rest of the company is still wildly profitable, so as a whole the company isn't actually financially unstable. It's different to say, Sony, who rely on the videogame division to make a great deal of profits and who post a greatly diminished income when that division does badly.
But the rest of the company is still wildly profitable, so as a whole the company isn't actually financially unstable. It's different to say, Sony, who rely on the videogame division to make a great deal of profits and who post a greatly diminished income when that division does badly.
As long as the 360 keeps getting penetration (harder, faster, stronger) as long as the rest of MS stays profitable the 360 will be around, even if it is losing money. I'm sure MS didn't think it would be the world leader or maybe even be profitable with the second round of consoles.
But the rest of the company is still wildly profitable, so as a whole the company isn't actually financially unstable. It's different to say, Sony, who rely on the videogame division to make a great deal of profits and who post a greatly diminished income when that division does badly.
Yeah but when a division has been operating at a loss for almost a decade MS might not be so quick to keep it alive.
If they don't pull out of the red after September and hype about Halo 3, you're probably going to see some changes in how they do business as they slowly pull away from the console market for good.
But the rest of the company is still wildly profitable, so as a whole the company isn't actually financially unstable. It's different to say, Sony, who rely on the videogame division to make a great deal of profits and who post a greatly diminished income when that division does badly.
Yeah but when a division has been operating at a loss for almost a decade MS might not be so quick to keep it alive.
If they don't pull out of the red after September and hype about Halo 3, you're probably going to see some changes in how they do business as they slowly pull away from the console market for good.
Wait, you agree with vicious? Jesus, now I have two people to dismiss whenever I see their posts.
You know that whole IPTV thing? You know the video services on xbox live? You know that whole disney signing the fuck up with them? What the fuck do you think that is?
It's *exactly* what they want. It's the start of their long terms goals, and they're finally getting there. Not to mention what syndallis said: *one* great quarter and the division makes back its losses.
But the rest of the company is still wildly profitable, so as a whole the company isn't actually financially unstable. It's different to say, Sony, who rely on the videogame division to make a great deal of profits and who post a greatly diminished income when that division does badly.
As long as the 360 keeps getting penetration (harder, faster, stronger) as long as the rest of MS stays profitable the 360 will be around, even if it is losing money. I'm sure MS didn't think it would be the world leader or maybe even be profitable with the second round of consoles.
I fail to see how that article supports the financial scenario that the x-box division is in currently considering it's been in the hole for a couple of billion for almost a decade.
Sure it would apply if they tied in the sales of the console with Vista, MS office 2007 ect. but they're not.
They're not turning a profit.
I don't see them turning a profit.
As a result I still think that they're going to sever ties with the console industry in order to entice investors.
But the rest of the company is still wildly profitable, so as a whole the company isn't actually financially unstable. It's different to say, Sony, who rely on the videogame division to make a great deal of profits and who post a greatly diminished income when that division does badly.
As long as the 360 keeps getting penetration (harder, faster, stronger) as long as the rest of MS stays profitable the 360 will be around, even if it is losing money. I'm sure MS didn't think it would be the world leader or maybe even be profitable with the second round of consoles.
I fail to see how that article supports the financial scenario that the x-box division is in currently considering it's been in the hole for a couple of billion for almost a decade.
Sure it would apply if they tied in the sales of the console with Vista, MS office 2007 ect. but they're not.
They're not turning a profit.
I don't see them turning a profit.
As a result I still think that they're going to sever ties with the console industry in order to entice investors.
But the rest of the company is still wildly profitable, so as a whole the company isn't actually financially unstable. It's different to say, Sony, who rely on the videogame division to make a great deal of profits and who post a greatly diminished income when that division does badly.
Yeah but when a division has been operating at a loss for almost a decade MS might not be so quick to keep it alive.
If they don't pull out of the red after September and hype about Halo 3, you're probably going to see some changes in how they do business as they slowly pull away from the console market for good.
Wait, you agree with vicious? Jesus, now I have two people to dismiss whenever I see their posts.
You know that whole IPTV thing? You know the video services on xbox live? You know that whole disney signing the fuck up with them? What the fuck do you think that is?
It's *exactly* what they want. It's the start of their long terms goals, and they're finally getting there. Not to mention what syndallis said: *one* great quarter and the division makes back its losses.
Yeah, I agree with most of what Vicious said.
As for the asinine statement I decided to bold and bring to your attention, tell me oh great guru of finance, how do you suggest that they climb out of a roughly 5 billion dollar hole when they've lost money since the product's inception? IN ONE QUARTER?! Are you completely insane?
In q2, they lost 289 million. Granted, that's less of a loss then q1 but it's still a huge gap to profit land.
Meiz on
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RoshinMy backlog can be seen from spaceSwedenRegistered Userregular
edited July 2007
Lol, MS have stated from the very beginning that they're in this for the long run. The Xbox did pretty well, the 360 does even better, and who knows where the next machine will end up? MS didn't get into the console business by accident. They didn't take the wrong corner and suddenly found themselves with a console in their hands. They have observed and analyzed the market to death and then finally, they took the plunge and so far I'd say things are going more or less to plan.
If it hadn't been for Nintendo's runaway success with the Wii (which no outside of Nintendo expected), MS would be number 1 right now. Time to pack it in, boys!
But the rest of the company is still wildly profitable, so as a whole the company isn't actually financially unstable. It's different to say, Sony, who rely on the videogame division to make a great deal of profits and who post a greatly diminished income when that division does badly.
As long as the 360 keeps getting penetration (harder, faster, stronger) as long as the rest of MS stays profitable the 360 will be around, even if it is losing money. I'm sure MS didn't think it would be the world leader or maybe even be profitable with the second round of consoles.
I fail to see how that article supports the financial scenario that the x-box division is in currently considering it's been in the hole for a couple of billion for almost a decade.
Sure it would apply if they tied in the sales of the console with Vista, MS office 2007 ect. but they're not.
They're not turning a profit.
I don't see them turning a profit.
As a result I still think that they're going to sever ties with the console industry in order to entice investors.
You missed the point
THEY'RE A LOSS LEADER TO GET INTO THE MARKET.
Do you get the point now?
Do you really think MS stock buyers are scared?
Do you?
Are you that nuts?
They've been operating at a multi-billion dollar loss for over 6 years. This little strategy you say they are using would apply if they turned a profit.
But the rest of the company is still wildly profitable, so as a whole the company isn't actually financially unstable. It's different to say, Sony, who rely on the videogame division to make a great deal of profits and who post a greatly diminished income when that division does badly.
Yeah but when a division has been operating at a loss for almost a decade MS might not be so quick to keep it alive.
If they don't pull out of the red after September and hype about Halo 3, you're probably going to see some changes in how they do business as they slowly pull away from the console market for good.
but they know there's potential for vast profit and they're on the verge of making some of it
like i said, they're not in the same situation as sony because microsoft is vastly profitable
i'd say sony are closer to dropping out the market than microsoft, and i shouldn't think either will at any time in the near future
But the rest of the company is still wildly profitable, so as a whole the company isn't actually financially unstable. It's different to say, Sony, who rely on the videogame division to make a great deal of profits and who post a greatly diminished income when that division does badly.
Yeah but when a division has been operating at a loss for almost a decade MS might not be so quick to keep it alive.
If they don't pull out of the red after September and hype about Halo 3, you're probably going to see some changes in how they do business as they slowly pull away from the console market for good.
but they know there's potential for vast profit and they're on the verge of making some of it
like i said, they're not in the same situation as sony because microsoft is vastly profitable
i'd say sony are closer to dropping out the market than microsoft, and i shouldn't think either will at any time in the near future
I'm anxious to see what happens post September. I don't see them pulling a profit personally considering their 6 year track record and current events as a whole. Regardless of the fact that they have a good amount of bank backing them up, a couple of billion dollars isn't something people just glance over with ease when it's a number that's pointing in the negatives.
But the rest of the company is still wildly profitable, so as a whole the company isn't actually financially unstable. It's different to say, Sony, who rely on the videogame division to make a great deal of profits and who post a greatly diminished income when that division does badly.
Yeah but when a division has been operating at a loss for almost a decade MS might not be so quick to keep it alive.
If they don't pull out of the red after September and hype about Halo 3, you're probably going to see some changes in how they do business as they slowly pull away from the console market for good.
but they know there's potential for vast profit and they're on the verge of making some of it
like i said, they're not in the same situation as sony because microsoft is vastly profitable
i'd say sony are closer to dropping out the market than microsoft, and i shouldn't think either will at any time in the near future
I'm anxious to see what happens post September. I don't see them pulling a profit personally considering their 6 year track record and current events as a whole. Regardless of the fact that they have a good amount of bank backing them up, a couple of billion dollars isn't something people just glance over with ease when it's a number that's pointing in the negatives.
They didn't for every single other post-Office investment that they've made.
Anyone who thinks MS will pull out now has not looked at the history of the way that company does business in non-vidjagame areas.
I... Hells. I feel like somebody is slowly hammering a dull, rusty spoon into my forehead.
Okay, here's the deal (again): The Xbox (original, division, 360, after 360) is the stepping stone for Microsoft getting into the business of delivering digital, downloadable/streaming content into consumers' living rooms: games, movies, music, interactive content, anything MS can make money on. Xbox Live is still pretty much a beta of the type of service MS wants to eventually get into as many homes as possible. As bandwidth expands, Live will continue to grow with more offerings and possibly different pieces of hardware for getting content into living rooms. That is where the real cash will be and that is MS's long-term goal here.
For the Xbox in general, I'm not really worried about the console itself and the "olol M$ insider trading/Bach/Moore" stuff. What I am worried about is the gouging we've been seeing for Live subscribers--that's starting to piss people off and I think MS is getting cocky with the success of Live lately. If Home turns out to be a killer app for the PS3 (a long shot, IMHO), or if Nintendo gets serious about putting together some type of online strategy, MS could find some serious competition to Live and have to rework its plans.
Once a console is sold, that's it--no more money is spent on that specific console model itself. The goal is to have a continuous revenue stream with downloadable and/or streaming content. So long as Xbox Live (and whatever it morphs into) offers a revenue stream in the present and forecasts look good for its future, the Xbox division--or a better term would probably be a general Microsoft Digital Entertainment Division--won't be going anywhere.
Now, if anyone wants to show me some bleak prospects for Xbox Live backed up by some solid numbers and forecasts, then I might give some of this a little more thought.
NexusSix on
REASON - Version 1.0B7 Gatling type 3 mm hypervelocity railgun system
Ng Security Industries, Inc.
PRERELEASE VERSION-NOT FOR FIELD USE - DO NOT TEST IN A POPULATED AREA
-ULTIMA RATIO REGUM-
Also what you see as millions dollars "lost" is to MS millions of dollars "invested". I know this is a difficult conceptual chasm to cross, but do try won't you? If your claim is that it would have been a smarter business decision for Microsoft to put the money in the bank and sit on it then you have a faulty notion of what MS are attempting (which, for the sake of us all, I won't try to quantify for you, because it's fairly obvious).
But the rest of the company is still wildly profitable, so as a whole the company isn't actually financially unstable. It's different to say, Sony, who rely on the videogame division to make a great deal of profits and who post a greatly diminished income when that division does badly.
Yeah but when a division has been operating at a loss for almost a decade MS might not be so quick to keep it alive.
If they don't pull out of the red after September and hype about Halo 3, you're probably going to see some changes in how they do business as they slowly pull away from the console market for good.
but they know there's potential for vast profit and they're on the verge of making some of it
like i said, they're not in the same situation as sony because microsoft is vastly profitable
i'd say sony are closer to dropping out the market than microsoft, and i shouldn't think either will at any time in the near future
I'm anxious to see what happens post September. I don't see them pulling a profit personally considering their 6 year track record and current events as a whole. Regardless of the fact that they have a good amount of bank backing them up, a couple of billion dollars isn't something people just glance over with ease when it's a number that's pointing in the negatives.
They didn't for every single other post-Office investment that they've made.
Anyone who thinks MS will pull out now has not looked at the history of the way that company does business in non-vidjagame areas.
Unless you're going to cite examples I'm not going to entertain this point unless you can show that Microsoft had introduced a product that ended up costing them billions of dollars over a 6 year time frame.
I... Hells. I feel like somebody is slowly hammering a dull, rusty spoon into my forehead.
Okay, here's the deal (again): The Xbox (original, division, 360, after 360) is the stepping stone for Microsoft getting into the business of delivering digital, downloadable/streaming content into consumers' living rooms: games, movies, music, interactive content, anything MS can make money on. Xbox Live is still pretty much a beta of the type of service MS wants to eventually get into as many homes as possible. As bandwidth expands, Live will continue to grow with more offerings and possibly different pieces of hardware for getting content into living rooms. That is where the real cash will be and that is MS's long-term goal here.
For the Xbox in general, I'm not really worried about the console itself and the "olol M$ insider trading/Bach/Moore" stuff. What I am worried about is the gouging we've been seeing for Live subscribers--that's starting to piss people off and I think MS is getting cocky with the success of Live lately. If Home turns out to be a killer app for the PS3 (a long shot, IMHO), or if Nintendo gets serious about putting together some type of online strategy, MS could find some serious competition to Live and have to rework its plans.
Once a console is sold, that's it--no more money is spent on that specific console model itself. The goal is to have a continuous revenue stream with downloadable and/or streaming content. So long as Xbox Live (and whatever it morphs into) offers a revenue stream in the present and forecasts look good for its future, the Xbox division--or a better term would probably be a general Microsoft Digital Entertainment Division--won't be going anywhere.
Now, if anyone wants to show me some bleak prospects for Xbox Live backed up by some solid numbers and forecasts, then I might give some of this a little more thought.
Yeah, Live is indeed a nice service that has the potential to make money but it hasn't. That's my point. Nothing has.
As for bleak prospects. They've been operating at a loss for 6 years for roughly 5 billion dollars and have yet to pull a profit. I don't see how bleaker you can get
Yeah, Live is indeed a nice service that has the potential to make money but it hasn't. That's my point. Nothing has.
As for bleak prospects. They've been operating at a loss for 6 years for roughly 5 billion dollars and have yet to pull a profit. I don't see how bleaker you can get
they could be sitting on a big money loser with no immediate prospects and dwindling profits year on year directly due to costs associated with this venture
protip: the company in this situation is not microsoft
Also what you see as millions dollars "lost" is to MS millions of dollars "invested". I know this is a difficult conceptual chasm to cross, but do try won't you? If your claim is that it would have been a smarter business decision for Microsoft to put the money in the bank and sit on it then you have a faulty notion of what MS are attempting (which, for the sake of us all, I won't try to quantify for you, because it's fairly obvious).
Pretty much. MS is a BIG company, of which the gaming division is a part. That "loss" is "investment" in their minds. And you don't cut an investment loose when it's on the verge of turning a profit. That's so stupid I can't imagine anyone entertaining the idea.
Q4 2007 is the big showdown time. It's 360s big releases vs PS3s big releases. This isn't the time to pussy out. This is the time to go in for the kill. If MS can beat Sony's ass down again this holiday season, they can grab up a ton of exclusives for their system. Or at least steal a bunch of the PS3s. Which puts them in as the winner for this generation more or less (the Wii, due to hardware/controls/waggle/sales/etc is competing on a whole other planet at this point). Their already the cheaper of the 2. If they can keep as many games as possible either 360 exclusives or multi-platform, they win.
shryke on
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Clutch414Dodge Swinger.......WHENEVER IT FEELS RIGHT!!!Registered Userregular
edited July 2007
Gosh....the stupidity in this thread is beyond the pale.
Read the part where is the article says they put the losses on FY 2007 results and that ended last week (at the time of the article July 5, 2007) Meiz, if you're going to put forth a ridiculous DOOOOOOOOOOOM theory, at least get your facts straight.
So...over the past five years MS has lost ~$6 billion on the H+E division and that spells DOOOOOOM for the Xbox...but the fact that Sony (the UNDISPUTED champ of the console war the past 2 generations) has lost ONE THIRD THAT AMOUNT (~$2 Billion, for those who struggle with TEH MATHS) the past single YEAR on their games division is no problem at all? Puhhh-lease.
Mind you, this loss happened the same year they launched the PS3.
i would say a change in direction is a possibility if they don't start turning a profit in the next couple of years, but i don't see them pulling out of the console market. Their goal for the xbox was to establish a foothold and get a reputation, which it did. It didn't "win", but it did quite well, better than expected (i, myself, thought it would bomb miserably). With that reputation established, the impression i got for the 360 was to take on Sony in the 'powerful console' market. From the first news we heard about it, it was very closely matched to what we expected the PS3 to do, and it was predicted they'd be competing for the same market and game titles. As we've seen, a number of exclusives (full and timed) are now going multi-platform, and some even jumping ship entirely. It's had a year's head-start, sure, but only a fool would say it's not going toe-to-toe with the PS3 and holding its ground.
Now, what you do have, is the Nintendo factor. From the outset, the Wii was seen as the 'other' console. Many people predicted that homes would have a 360 and a Wii, or a PS3 and a Wii. It's cheaper, it's more user-friendly, and has a wider appeal. As such, it's selling through the roof and making Nintendo stacks of cash. Comparatively, it's thrashing the pants off the 360 and PS3, together. So while MS might be succeeding in their goal of taking on the PS3, Nintendo have shown that there's a much bigger, more lucrative market out there. So what you may well find, if competing on their current ground doesn't go as well as expected (even though this run up to Christmas looks pretty rosy), they may well shift for a cheaper, more broad-reaching console. I don't even mean 'lol waggle', as obviously, just like they're already competing in the power console market, they'd only be trying to take business away from Nintendo by imitating. They'd do better to try and innovate and find their own market.
As for bleak prospects. They've been operating at a loss for 6 years for roughly 5 billion dollars and have yet to pull a profit. I don't see how bleaker you can get
"The latest and final report in the Spotlight on Television 2.0 Leaders series delivers unique and early insight into just how much revenue Microsoft can expect to generate with its new Xbox-based video services, and how rapidly this business might grow. According to our preliminary analysis, the combined revenue from the sale of both TV shows and movies via Xbox Live could reach $92.25 million in 2007, growing each year through 2011, when the aggregate revenue from the sale of both types of content could top $726 million."
NexusSix on
REASON - Version 1.0B7 Gatling type 3 mm hypervelocity railgun system
Ng Security Industries, Inc.
PRERELEASE VERSION-NOT FOR FIELD USE - DO NOT TEST IN A POPULATED AREA
-ULTIMA RATIO REGUM-
Hasn't... made... money? You mean, hasn't turned a profit. There are many things companies do that do not immediately generate profit. Like, say, paying staff. I mean, paying staff is just money out the window guys. Let's just keep it in our money in our bank accounts because like the old saying goes: Fortune favours the guys who diligently save.
Investments don't always pay off. Often they don't pay off straight away. Sometimes they pay off big. Every company loses money on things that don't work and every company will continue to do so until we're all living in a socialist paradise where medicine is plucked from the very trees one lives in and we communicate through flavours.
You might also consider that money Microsoft "doesn't make" on the xbox is money it stopped Sony or another rival from making, and in that sense is a strategic loss. There is such a thing.
Posts
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In the span of like 291 posts.
http://steamcommunity.com/id/Cykstfc
So what i got from reading this entire thread was that people jump to some huge conclusioned based on rumors, hearsay, and internet rable. I posted the "math stuff" because it kinda jumped at me that fiscal year 06 and Q1 07 was a 1.5 billion loss for MS, but just fiscal year 06 was a 1.71 billion loss for Sony. Yet no one is saying Sonys doomed, or that its there last console.
I've always looked at it like this. Microsoft put the xbox out there to get there foot in the door, not to compete. It ended early because of whatever, be it the nvidia thing, or just wanting to be first with something bigger and better. The second console was made to compete in a very tuff market with console lifespans expected to be five years plus. Hell Sony has said 10 years for the PS3. So less than two years in theres a hardware revision that lowers there production cost, and fixes all those ocassional red rings. With 3 years left if not more on an average life span, its not unreasonalble to assume with the glaring issues fixed, they cant just sit back and make money.
also, pax?
Well, it has been competing with the two other consoles for the last 6 months and sales have been consistent. The Wii's been selling out everywhere. How much more competition do you want it to give?
But there is another ....
but you'd have to be a bit of a fanboy to predict the $600olol machine is gonna come out of nowhere to, not only outsell, but completely wipe the 360 off the face of the Earth.
Are you a fanboy?
EDIT: How could I forget
PortsCenter • Jump Leads • The Life Toyetic with Ben and Molly
That just drags out his insanely irrational point! Let's just talk about how Mario would totally kick Master Chiefs ass or vice versa!
However the fucking legion of doom (the millions of PS2 owners who have not moved to a new console yet) seem to be quite big fanboys to a certain brand. I caught Michael Pachter saying once that he thinks all the PS2 owners were waiting for a price drop before they start getting PS3s.
It's gonna be interesting.
The Atari owners didn't move to whatever numbered Atari that Atari was pushing during the time of the NES. A lot of the NES owners moved to the Genesis. Many of the SNES owners then moved to the Playstation instead of the N64. I see no reason to believe that the masses that bought the PS2 are loyal to the PS2 brand name.
Edit: Here are some Michael Pachter quotes:
http://thinkexist.com/quotes/michael_pachter/
But you just said they were losing money. If they really are deperate enough to bin the Xbox, because they're not making a profit, wouldn't they want to do that as soon as possible..?
Yeah, i don't think we need to worry about the stability of Microsoft in the gaming industry. Their commitment to the platform and Live is pretty fucking solid, and they have spent far too much money on future interests to just drop it after a couple years.
The only reason the DC died young is because the well ran dry. All of the gaming divisions losses over the past six years can easily be covered via one good quarter's profit for Microsoft; it's not like this is seriously impacting them, and they seem to WANT to have a leadership position in the market... so yeah.
I remember how everyone said the xbox was a stepping stone into a MS developed Windows PC... or how they were going to drop the product in 2003, or all of this other shit.
It is as silly as Nintendo being Doomed, or Sony packing up and ditching the PS3. Nobody is leaving right now; all three are here to stay for the forseeable future.
PAX?
Let's play Mario Kart or something...
My work here has just begun.
Because honestly, after reading most of the thread, I would love to see him put his manhood on the line. The Xbox360 looks to be doing fantastically well, at least from the consumer's point of view, and cancelling the entire console division just does not seem very sound.
I mean, why would Microsoft cancel their console division just as they are starting to get out of the red?
On topic: I never thought X07 as necessary, it's just another small E3 esque thing for the Xbox 360, hopefully they can put in the extra resources they saved to improve on the software on the 360.
Oh but they're coming out of the red. No, they're not. That's the point.
Edit: Not to mention the other billion dollar hole that has to do with warranties.
http://www.bizjournals.com/albuquerque/stories/2007/07/02/daily19.html
Another edit:
Article in 2005
http://www.forbes.com/home/technology/2005/09/12/microsoft-management-software_cz_vm_0913microsoft.html
So 4 billion up to 2005, 1.2 in 2006, 1.3 in 2007 and the year isn't even over yet!
Wake up and smell the maple nut crunch.
To further what this man just said:
http://en.wikipedia.org/wiki/Loss_leader
As long as the 360 keeps getting penetration (harder, faster, stronger) as long as the rest of MS stays profitable the 360 will be around, even if it is losing money. I'm sure MS didn't think it would be the world leader or maybe even be profitable with the second round of consoles.
Yeah but when a division has been operating at a loss for almost a decade MS might not be so quick to keep it alive.
If they don't pull out of the red after September and hype about Halo 3, you're probably going to see some changes in how they do business as they slowly pull away from the console market for good.
Wait, you agree with vicious? Jesus, now I have two people to dismiss whenever I see their posts.
You know that whole IPTV thing? You know the video services on xbox live? You know that whole disney signing the fuck up with them? What the fuck do you think that is?
It's *exactly* what they want. It's the start of their long terms goals, and they're finally getting there. Not to mention what syndallis said: *one* great quarter and the division makes back its losses.
I fail to see how that article supports the financial scenario that the x-box division is in currently considering it's been in the hole for a couple of billion for almost a decade.
Sure it would apply if they tied in the sales of the console with Vista, MS office 2007 ect. but they're not.
They're not turning a profit.
I don't see them turning a profit.
As a result I still think that they're going to sever ties with the console industry in order to entice investors.
You missed the point
THEY'RE A LOSS LEADER TO GET INTO THE MARKET.
Do you get the point now?
Do you really think MS stock buyers are scared?
Do you?
Are you that nuts?
Yeah, I agree with most of what Vicious said.
As for the asinine statement I decided to bold and bring to your attention, tell me oh great guru of finance, how do you suggest that they climb out of a roughly 5 billion dollar hole when they've lost money since the product's inception? IN ONE QUARTER?! Are you completely insane?
In q2, they lost 289 million. Granted, that's less of a loss then q1 but it's still a huge gap to profit land.
If it hadn't been for Nintendo's runaway success with the Wii (which no outside of Nintendo expected), MS would be number 1 right now. Time to pack it in, boys!
They've been operating at a multi-billion dollar loss for over 6 years. This little strategy you say they are using would apply if they turned a profit.
Which they've failed to do.
So your point is moot.
Ok so it's 6 years of nothing but red.
I stand corrected but it's still billions of dollars lost.
but they know there's potential for vast profit and they're on the verge of making some of it
like i said, they're not in the same situation as sony because microsoft is vastly profitable
i'd say sony are closer to dropping out the market than microsoft, and i shouldn't think either will at any time in the near future
I'm anxious to see what happens post September. I don't see them pulling a profit personally considering their 6 year track record and current events as a whole. Regardless of the fact that they have a good amount of bank backing them up, a couple of billion dollars isn't something people just glance over with ease when it's a number that's pointing in the negatives.
They didn't for every single other post-Office investment that they've made.
Anyone who thinks MS will pull out now has not looked at the history of the way that company does business in non-vidjagame areas.
I... Hells. I feel like somebody is slowly hammering a dull, rusty spoon into my forehead.
Okay, here's the deal (again): The Xbox (original, division, 360, after 360) is the stepping stone for Microsoft getting into the business of delivering digital, downloadable/streaming content into consumers' living rooms: games, movies, music, interactive content, anything MS can make money on. Xbox Live is still pretty much a beta of the type of service MS wants to eventually get into as many homes as possible. As bandwidth expands, Live will continue to grow with more offerings and possibly different pieces of hardware for getting content into living rooms. That is where the real cash will be and that is MS's long-term goal here.
For the Xbox in general, I'm not really worried about the console itself and the "olol M$ insider trading/Bach/Moore" stuff. What I am worried about is the gouging we've been seeing for Live subscribers--that's starting to piss people off and I think MS is getting cocky with the success of Live lately. If Home turns out to be a killer app for the PS3 (a long shot, IMHO), or if Nintendo gets serious about putting together some type of online strategy, MS could find some serious competition to Live and have to rework its plans.
Once a console is sold, that's it--no more money is spent on that specific console model itself. The goal is to have a continuous revenue stream with downloadable and/or streaming content. So long as Xbox Live (and whatever it morphs into) offers a revenue stream in the present and forecasts look good for its future, the Xbox division--or a better term would probably be a general Microsoft Digital Entertainment Division--won't be going anywhere.
Now, if anyone wants to show me some bleak prospects for Xbox Live backed up by some solid numbers and forecasts, then I might give some of this a little more thought.
Ng Security Industries, Inc.
PRERELEASE VERSION-NOT FOR FIELD USE - DO NOT TEST IN A POPULATED AREA
-ULTIMA RATIO REGUM-
Unless you're going to cite examples I'm not going to entertain this point unless you can show that Microsoft had introduced a product that ended up costing them billions of dollars over a 6 year time frame.
Also, Zune.
Yeah, Live is indeed a nice service that has the potential to make money but it hasn't. That's my point. Nothing has.
As for bleak prospects. They've been operating at a loss for 6 years for roughly 5 billion dollars and have yet to pull a profit. I don't see how bleaker you can get
they could be sitting on a big money loser with no immediate prospects and dwindling profits year on year directly due to costs associated with this venture
protip: the company in this situation is not microsoft
Pretty much. MS is a BIG company, of which the gaming division is a part. That "loss" is "investment" in their minds. And you don't cut an investment loose when it's on the verge of turning a profit. That's so stupid I can't imagine anyone entertaining the idea.
Q4 2007 is the big showdown time. It's 360s big releases vs PS3s big releases. This isn't the time to pussy out. This is the time to go in for the kill. If MS can beat Sony's ass down again this holiday season, they can grab up a ton of exclusives for their system. Or at least steal a bunch of the PS3s. Which puts them in as the winner for this generation more or less (the Wii, due to hardware/controls/waggle/sales/etc is competing on a whole other planet at this point). Their already the cheaper of the 2. If they can keep as many games as possible either 360 exclusives or multi-platform, they win.
To clear up some confusion.
Meiz said that 2007 isn't over yet.
FY 2007 ended June 30, 2007. We are now into FY 2008.
http://kotaku.com/gaming/business/microsoft-sticking-to-2008-profit-forecasts-275429.php
Read the part where is the article says they put the losses on FY 2007 results and that ended last week (at the time of the article July 5, 2007) Meiz, if you're going to put forth a ridiculous DOOOOOOOOOOOM theory, at least get your facts straight.
So...over the past five years MS has lost ~$6 billion on the H+E division and that spells DOOOOOOM for the Xbox...but the fact that Sony (the UNDISPUTED champ of the console war the past 2 generations) has lost ONE THIRD THAT AMOUNT (~$2 Billion, for those who struggle with TEH MATHS) the past single YEAR on their games division is no problem at all? Puhhh-lease.
Mind you, this loss happened the same year they launched the PS3.
But the Xbox is DOOOOOOOOOMED?
Now, what you do have, is the Nintendo factor. From the outset, the Wii was seen as the 'other' console. Many people predicted that homes would have a 360 and a Wii, or a PS3 and a Wii. It's cheaper, it's more user-friendly, and has a wider appeal. As such, it's selling through the roof and making Nintendo stacks of cash. Comparatively, it's thrashing the pants off the 360 and PS3, together. So while MS might be succeeding in their goal of taking on the PS3, Nintendo have shown that there's a much bigger, more lucrative market out there. So what you may well find, if competing on their current ground doesn't go as well as expected (even though this run up to Christmas looks pretty rosy), they may well shift for a cheaper, more broad-reaching console. I don't even mean 'lol waggle', as obviously, just like they're already competing in the power console market, they'd only be trying to take business away from Nintendo by imitating. They'd do better to try and innovate and find their own market.
Numbers/forecasts/reference sources, please.
Wait, here are a few numbers (source):
"The latest and final report in the Spotlight on Television 2.0 Leaders series delivers unique and early insight into just how much revenue Microsoft can expect to generate with its new Xbox-based video services, and how rapidly this business might grow. According to our preliminary analysis, the combined revenue from the sale of both TV shows and movies via Xbox Live could reach $92.25 million in 2007, growing each year through 2011, when the aggregate revenue from the sale of both types of content could top $726 million."
Ng Security Industries, Inc.
PRERELEASE VERSION-NOT FOR FIELD USE - DO NOT TEST IN A POPULATED AREA
-ULTIMA RATIO REGUM-
Investments don't always pay off. Often they don't pay off straight away. Sometimes they pay off big. Every company loses money on things that don't work and every company will continue to do so until we're all living in a socialist paradise where medicine is plucked from the very trees one lives in and we communicate through flavours.
You might also consider that money Microsoft "doesn't make" on the xbox is money it stopped Sony or another rival from making, and in that sense is a strategic loss. There is such a thing.