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Forums - Microsoft Discussion - How Did Microsoft Lose In The Video Gaming Market?

You obviously have a hate for consoles, but I hate to burst your bubble and they aren't going away. Second of all how did Microsoft lose? They are on track to hit 40 million consoles sold within the next couple months and will most likely double the sales of the original Xbox within a year. The console itself is making money contrary to what you believe. Microsoft has made alot of good moves and their software library can line up with any console present or past. Finally the PC games market is miniscule and tbh I doubt Microsoft is losing sleep over it. As far as I know Nintendo has 0 involvement in the PC market and they are making tons of money. Sony would be a close second. So out of the 3 console makers Microsoft is still tops in the PC division. Shows how small a market it is.



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The fact more games are coming out on platforms other than Windows, that is the Mac, does not bode well for Microsoft's main source of revenue, Windows and Office.

I remember reading, on this very forum actually, that in Revenue the Xbox part is almost half that of the OS and Office part of Microsoft, yet the Profti from Xbox is something like 1% of the profit from their OS and Office. Makes me wonder if them giving up on PC gaming has hit their OS, since that would mean they made a huge mistake.



supercat said:
I think that MS's opportunities for the next gen have both lower risk and return.

Less risk b/c they won't be so studpid the next time and make a console that will melt during a halo game

Less return, because they won't have the advantage of a highly overpriced PS4 and will have to pay royalties to Sony for every Blu-ray based game, assuming of course that the 720 will be using blu-ray for its games.

So, the 720 should have a lot less upside and also get rid of the losses in profits sooner (no RROD w/ the 720) .

The next Xbox will not use BluRay. Expect something new, HVDs, or Digital Distribution.



How do you lose what you never had?



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11/20/09 04:25 makingmusic476 Warning Other (Your avatar is borderline NSFW. Please keep it for as long as possible.)

No, they have not and most likely will not lose in the gaming market.  They are doing quite well actually.



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mirgro said:

The fact more games are coming out on platforms other than Windows, that is the Mac, does not bode well for Microsoft's main source of revenue, Windows and Office.

I remember reading, on this very forum actually, that in Revenue the Xbox part is almost half that of the OS and Office part of Microsoft, yet the Profti from Xbox is something like 1% of the profit from their OS and Office. Makes me wonder if them giving up on PC gaming has hit their OS, since that would mean they made a huge mistake.

Well seeing as PCs don't run a Mac OS I don't think that is a problem. I don't see PC gamers spending $1500 on a Apple to play games. Microsoft will always have the huge market share as long as Apple decides not to license their software.



tuscaniman said:
mirgro said:

The fact more games are coming out on platforms other than Windows, that is the Mac, does not bode well for Microsoft's main source of revenue, Windows and Office.

I remember reading, on this very forum actually, that in Revenue the Xbox part is almost half that of the OS and Office part of Microsoft, yet the Profti from Xbox is something like 1% of the profit from their OS and Office. Makes me wonder if them giving up on PC gaming has hit their OS, since that would mean they made a huge mistake.

Well seeing as PCs don't run a Mac OS I don't think that is a problem. I don't see PC gamers spending $1500 on a Apple to play games. Microsoft will always have the huge market share as long as Apple decides not to license their software.

I am not so sure on that end. People are stupid and Apple can market. I know many people where they only had Windows so they can play games. Microsoft has been working very hard to remove that benefit, for some retarded reason it seems, and as it stands a lot more people will get  Macs or Linux and play on their 360s instead of bothering with Windows.

Whichever way you slice it, the OS trade of Microsoft makes the Xbox looks like fractions of a penny.



mrstickball said:
shio said:

How will Microsoft survive if the hardware becomes irrelevant?
How will Microsoft recapture the PC Games Market?
How will XBL/GFWL stop the Steam train?
Will Microsoft be profitable in it's third try in the console market?

 

 

Could you tell me where "money is still being lost"?

As for your answers:

  • How will hardware become irrelevant? If in case it does (which if it happens, is decades away), Microsoft has Xbox Live which has been the biggest online success of any console. It could easily ensure that Microsoft can offer a service system in the event that consoles go by the wayside (again, I do not see that for decades)
  • Why does Microsoft need to capture the PC gaming market, again? The market is far different today than it was 10 years ago when MS was in its prime. The market is going towards smaller, bite-sized games. I doubt Microsoft can really do a lot there. However, it can continue to be a strong value proposition for developers that want to build cross-platform games between the 360 and PC, which its been doing pretty well at.
  • Why is XBL in competition with Steam? XBL offers a much different breadth of content than Steam does. Its not just a gaming platform, but VoD and other such offerings. Microsoft does not need to compete with Steam. They need to compete with PSN and Nintendo Connect.
  • Given that MS has been profitable on the 360 for the past 2 years with pretty good profits, I fail to see why they could not manage to make a profitable 3rd console.

Money "being lost" in the sense that they won't be able to break even with Xbox 360, let alone the losses from the original Xbox.

I said IF the hardware becomes irrevelent, and the trend definitely supports that. The graphical quality gained by better hardware isn't as big as before, and hardware is much cheaper than ever.

Microsfot is trying to recapture some of the PC gaming market, or else they wouldn't have made any effort in making GFWL. I bundled XBL with GFWL because they're essentially a cross platform thing, although the GFWL side is much worse. In regards to cross-platforming, Steam is also doing that with MAC, and there are really strong rumors of them working on a Linux version.

Although MS has been profitable in the last 2 years, they won't break even from their efforts this gen.



Microsoft still has the PC games market because most PC companies are willing to work with Microsoft because of their history. Microsoft Survives off of software not videogame hardware. They haven't exactly failed because they have a mission which is to weaken Sony.



-if it weren't for bungie and halo you could have wrote epic fail on microsoft being in the console business a long time ago

-it true they don't do as much with PC games as they used to (for example no alan wake pc) but they still own windows which is the most widely used operating system so in their case who cares if they make any more pc games

-the fact that they really haven't profited on either xbox makes me question why they're still fighting to stay in the business. they must have some other drive than money or maybe they believe that they will profit one day and when i say profit i mean make up for previous losses since the original xbox...not like "oh look we turned a 500,000 profit this month because of halo3" still a long way to go after the 1.5 billion dollar hit they took from the extended warranty and RROD.

-xbox live will not stop the steam train at all. PC gamers are a totally different crowd than console gamers are. the main flaw with the PC is that you need to blow a few grand to get one that can play newer games with no problems hence why consoles are so much more popular because they are cost efficient(except for when the ps3 cost $500+). people do not want to pay $4000 for a PC that plays CRYSIS maxed out because it's not worth it. although you'll never find a better control scheme for shooters than the keyboard and mouse. I dont play many PC games I only have fallout 3, oblivion, and half-life2 and they're all better on the PC by far.

-as far as digital downloads go I am more in favor about owning a hard copy of the game. however in terms of distribution to the masses you can be sure that a game you want to download will never be sold out...also PC games are cheaper...to hell with the $60 console game price point. and another point to make is that downloaded games cannot break or get disc scratches. one problem though is hard drive space. you have people paying $100 for the 360 120 gig hard drive and with full game download that will fill up fast...so you won't see digital full game downloads on a console until the standard console hard drive gets larger.

-will microsoft turn a profit in the 3rd console generation? I wish I could answer that but I can't. what I do know is that if they plan to make a profit then they have to make a quality console. the 360's broke down on people and caused many headaches for over 3 years so they need a fresh start with a reliable product. and I'm sure the new 360's are much better but who knows how much better? for all we know the failure rate dropped from 52% to 16% which still is considered a high failure rate. but of course I'm just guessing here so maybe some of you can help out.

did anyone have *brand new* 360 fail on them that was bought after 2009?