| steven787 said: I don't agree Misterd, MS is in this to make money. They already have market share. This isn't about agreeing or disagreeing with me. MS has been relatively open about it's strategy from the start and its willingness to lose money for years because they believe the long term profit is worth it. Now, as profit goes, my understanding of the numbers (and someone correct me if I'm wrong) is that MS would have come close to turning a profit if not for the $1b warrantee extension (which also implies that they are in it to stay). With that taken care of, the cheaper "Falcon" hardware in the pipeline, and the potential to grow its base this holiday, there's a decent chance that they will be in the black next year. Xbox 1 was already had some of the features, 360 has many more at a price MS considers fair for a Home Media Center Household hub. The problem is people don't want one of those things. Don't tell me. Tell MS and Sony. I've thought this was a fool's errand from the start. Ironically, by expanding into the "casual" market, Nintendo's actually the one that's put itself in the best position. So long as the XB and PS appealed to "core" gamers, they would never be seen as anything but a gaming system, and never gain the sort of wide-scale acceptance needed to become the HMC. Or at least that's how I see it. Also 360 isn't marketed as a media hub, it has those features, but there aren't ads saying this. It isn't a DVR, a key feature that a media hub should have. It is costing them not just billions, but billions more than expected. We're not talking this generation or even the next. This is a multi-generation stategy. They want it to be a media hub where millions of people will go and download MS content for MSpoints, but people aren't doing it. Notice they tell us 6 million people have registered for Live, but don't tell us how many pay for Live Gold. Or how many paid downloads there have been. The reason? Because those numbers are disappointing. Or TV shows, or HD-DVD drives, etc. etc. etc. PSN has been just as unsuccessful, though I personally have downloaded more games than I ever thought I would because of the lack of "real" games. It is a failure, not as big of a failure as PS3. But MS can afford to quit, they make their money off of OS, Search Engines, Online Services and Office. They won't keep it going past Holiday '09 if it isn't making money by Holiday '08. (They would use '09 as a way to catch up, investing very little and hope to make back some of their losses.) As I recall MS lost something like $5b on the XBox. They didn't abandon it. They won't abandon the 360 either. Sony can't quit because the company has been structured around the success of the Playstation brand, Movies are the only profitable area left for them. Electronics are losing money for them. PS is losing money for them. Their attempts at entering PC's have been only marginally successful, while the Walkman has been killed by the Ipod. A lengthy life span for PS3 is their only option to bring the company as a whole back into the black. (Edit: How is 360 doing well? It has been in a steady decline since the holidays. It is costing MS 1.5-2 billion a year to keep it afloat. The 360 has great games, but so did Sega Genesis, Neo Geo, and Sega Dreamcast) |
The PS3's sales have been in stead decline as well, up to this week. And last I checked, Sony's game division was losing money too. Why don't they both drop the games to focus on their more profitable enterprises? Because they plan on a much different scale than you and I do, and are expecting to get their money much farther down the road.
