Microsoft’s Spencer on Xbox One Demand

[Madword]

Zappykins said:

endimion said:

 

sales number don't really matter (they do but it's just one element)... profit margin and attached rate and services sold is where it is at and at that game I think MS is in a better position than Sony even with a lower sale number... at 500 bucks they probably don't lose much money if any and they are really good at monetizing the XBL service and apps and all.... I wouldn't be surprised that this time again XB will be more profitable for MS and even devs even if they end up third in sales....

but we'll see, this gen will really be interesting, at least for people that care about those numbers and all... because the race will be way closer all things considered than last gen between PS/XB

You are correct, as it stands now reports are Microsoft will about break even with every Xbox One console sold.  Sony was hoping and planned to do that, but with the falling of the yen, have warned their investors they will be losing a little wih every console.  The more the sell, the more they lose (short term). Tough break for Sony.

I think there is a big difference this time, and that is the fight for subscription money. I suspect that if Sony outsell MS by a large figure, this will significantly damage MS's profitibility in the long run. I know many people hated Sony going down the paid route, but in terms of after year 1 - more money will be returned due to subscriptions than console profits I feel. 

Because of that perhaps Sony is prepared to take a loss initially and make the money back through subscriptions. One off hit, you get more console sales, you make more in the long run.