Oops, forgot to put Malstrom's comments about the above article....
http://seanmalstrom.wordpress.com/
Let’s talk about the bold for a second.
Conventional wisdom is saying that the Games Division is ‘profitable’. However, the investor wants it spun off to assess its ‘true value’. What is going on here is that much of the marketing, the warranties, and other costs for the Xbox 360 have been woven into other divisions to mask the huge losses. If there was no masking, why bother spinning the Xbox 360 off to assess its true value? Wouldn’t the ‘true value’ be seen already? It is because Microsoft blows vapor to cloud reality when it gets a chance. At E3 2008, Microsoft Press Conference ‘declared’ that Xbox 360 has majority marketshare in North America where everyone knew that in just a couple of days, the next NPD that would show this not to be the case. Or that everyone can see Nintendo’s third party charts for what they are. Yet, clarity is bad for Microsoft so they announce a ‘press release’ attempting to convolute the issue of third party sales in North America by saying “What Nintendo is saying is not true if you add in these factors or if you look at it this way or…”
Why does the games industry treat Microsoft as if it were some powerful behemoth? Sure, they have lots of money but it is all bad money. Bad money means it is paying for failing strategies and allowing failing strategies to continue. Xbox 360 has flopped in Japan and practically Asia. With one of three major markets with zero traction, we still are supposed to take Xbox 360 seriously as a ‘contender’? It is more akin to the PC-Engine that is very popular in one territory, somewhat popular in another, and completely dead everywhere else.
Keep in mind that Christensen has asked the U.S. Government not to interfere with Microsoft as he believes it is the number one company ripe for being disrupted.
(The investor mentions Apple TV as a flop. This is true. However, Apple only supports it as a ‘hobby from the developers’. Apple’s “stool”, shown by Steve Jobs at a recent keynote, is the iPhone, iPod, and Mac. Apple TV does qualify as a disruptive product, but Apple doesn’t seem interested in focusing on it for some reason.)
Wii Code 3456 7941 4060 2924
