While it's true that Microsoft can absorb the loss, it seems like people are trying to marginalize that loss. It's like saying you can lose a kidney because you have another--it's still a very bad thing.
Worst case scenario, Microsoft gets out of the core gaming business. Yes, it's way to soon to be thinking about that but imagine if Sony keeps doing things right and the Xbox brand never recovers. I don't think Microsoft management is committed to Xbox the way Sony is to Playstation. They'd certainly cut it loose if it became dead weight.
I don't think that will happen but it would also be foolish to pretend like Microsoft isn't watching Xbox performance closely. I promise you, they aren't simply going to blow off heavy losses with, "It's OK, we can afford it."
