I don't think the 360 "went" wrong. But there are mistakes to be adressed. This is what I think:

· Not purchasing Bioware, letting it fall into EA's hands.

· Failing to penetrate in Japan's market.

· Kinect meant that some first-party concentrated efforts onto it instead of controller-wise games.

· They have a great online infraestructure - Xbox Live - but they barely improved it throughout the years. It was only when the competition's online infraestructures gained enormous strenght that they started making progress.

· The worst, in my opinion, is the parity clause. Timed exclusives not so much, but parity clause meant that games that didn't release on a Xbox machine but others wouldn't see the light on it. This prevented games such as Guacamelee and others reaching 360's gamebase, which equal to less games. This parity clause is a disgrace.

  The 360 sold  over 80 million units.. That's not bad at all.

360 didn't do anything wrong. I think 360 was a huge success. If you look at how much they improve their install base I would say they did very well.
There is no way they would dominate Nintendo and Playstation, they just didn't have enough recognition in the past. PS2 had 150 Millions console sold with PS1 at 110 millions.
The 360 was on it's way to crush the PS3 until Sony released the PS3 slim and then Sony never looks backs.
Also Europe seems to be pretty much "branded" Sony and Japan let's not even talk about it.
It seems like the last 2 years microsoft was more focusing on releasing the One; to have yet again another year advantage over Sony; that would explain the lack of exclusives on 360 the last 2 years. But it seems to have back fired on them because now while Sony is releasing more exclusives on the PS3, they also manage to release the PS4 in the same month as the Xbox One.
I don't think 360 did anything wrong, just that Sony step up their game with the PS3 slim...

Aye, would be like if at one Race a runner was at the 20meter mark while the other was crossing the finish line but then the following Race it was neck and neck right til the end.

You can't really say the 360 went anywhere wrong with this level of improvement over the first Xbox

You make the assumption that they have to be the top-selling console to win. Hello! Only fanboys think that way.

Microsoft, even with a smaller userbase, knows how to make the bucks. At the end of this generation, I'd love to know the profit margin and revenue earned. I really think MS is less concerned with being the top-selling console but more concerned with being the biggest money-making console for themselves and game/app developers in the living room.

That's how they win.

1. Agreed
2. Trying to please Japanese consumers isn't worthwhile for MS. Even Sony is less concerned with Japan and focusing on the west.
3. MS gained a lot of ground in Europe.
4. MS gained ground with the casual audience.
5. Bluray wasn't a necessity and would have made the 360 more expensive.
6. MS competing with the odds against them doesn't mean MS did something wrong. I think you missed the point of the thread.

I think it was a success. But they do have to find a way to compete at least somewhat in Japan if they ever want to win a generation in sales.

The OP isn't necessarily saying that they did poorly, but rather, they had a lot good going for them yet they didn't manage to hold off Nintendo early on and have yet to topple Sony.

Ultimately it came down to mid-late gen. Sony kept on going strong, Microsoft dropped almost all support for the 360. I think that's what it came down to.

no they don't. countries like france, Uk and germany seem like bigger markets. All Japan wants is handhelds and JRPG's that don't appeal to western audiences. Why both in Japan?

You realize that ms and the 360 won last generation. They didnt sell the most consoles but that has a minimal amount to do with success.