Regardless of what Iwata says, It is Microsoft who can not compete according to Sean Malstrom.

[Puppyroach]

DanneSandin said:

Puppyroach said:

DanneSandin said:
It's actually pretty important. Let's say they continue this trend of losing money on their Xbox division; it's far more likely that investors will want to close that division then. As I understand it, the Xbox brand as a whole have lost more money than MS has earned (I could be wrong, but that's what I keep hearing) in the long run, and that can not continue.

I think that's why ppl keeps bringing it up; losing money is never a good thing. They're fine today, but how about tomorrow?

What are you talking about? Of course the history is completely irrelevant when looking at the profitability of a brand. It is almost an impossibility to not rack up losses when you start a new business segment. The chalenge for MS was even greater since noone before had been succesful in a three-way race in the console business.

What you need to look at is how this investment has payed of, which shows they have had 6 straight years of profit. If they continue on this path, the E&D department will only add brand awareness and hard cash to MS as a whole. The trend is actually really positive at the moment.

You are contradicting yourself: Of course the history is completely irrelevant when looking at the profitability of a brand

they have had 6 straight years of profit [...] The trend is actually really positive at the moment.

To have a trend you need to have a history - so it ISN'T irrelevent to look at MS's history in console gaming. The history is PART of the trend going forward. Yes, Xbox is making money now, but from what I've seen the brand as a whole has lost more money than its made, and that's something to remember because it's important for the brand to generate money from the get go with the Xbone - MS has said so themselves.

Investors won't be interested in Xbox if it doesn't recover the losses sustained from the past 12 years. True, they're having a positive trend earning tons of cash, but that's also a trend they have to keep alive.

There is no contraditcion at all. Losses do not accumulate only to be payed when you start to run a profit. It is the exact same thing as if a company make big profits during alot of years only to suddenly take losses instead (Sony comes to mind). The history is irrelevant in that case, instead you need to look at the trend of the company.

MS´s trend the first years were negative and the last couple of years have been positive, do you not agree? Would an investor then recommend removing the XBox brand at the time it is ADDING cash to the company instead of during the time it made LOSSES?

An example: Imagine you run a conveniace store where one segment of the product line is milk. That specific product line is selling bad andactually cost you more than it makes when looking at salaries, cooling and such. After a few years you start to sell better and that segment starts to turn a profit. Would you then focus on the losses it made before or the profits it makes now? :)