The Xbox One beat the PS4 in November, but at what cost? We do the math

[Alby_da_Wolf]

jacks81x said:

MoHasanie said:

S.T.A.G.E. said:

MS can afford it so its not really  that big of a deal right now.  This is all being done for show. If they were to keep it up it would become a problem. They'll go back to $400 in overall price and if Sony continues to wreck them they'll drop the price again between June-september. Its obvious that this isnt about profit because the Xbox One had been selling very well. Its just that when Sony sells well its on another level. MS had to devalue their console in the first year just to catch up to what Sony naturally sells at $400.

MS can easily afford it but with a new CEO in charge, and one who thinks "Xbox is not a core part of Microsoft", he might not be willing to keep a division which barely makes money. 

Also, each division within the company has its own budget and projections for the year.  So just because the parent company can afford it, it doesn't mean the XBox division can just spend whatever they want.   That's true for any big company, institutions, schools, etc.  

Yes, but look for the string "corporate-level" and the balance item "Corporate and Other" in MS balance sheets: it's a balance item separated from every division and purely at loss, that includes a lot of costs, losses, legal expenses, the cost of every R&D that can be used by more than one divison, etc. and makes the least profiting or even losing divisions look better than they are. Gaming division eventually turns to profit during a gen and the situation almost always betters from an usually awful start (except for the first XB, plagued by a horrible deal with NVidia and Intel for GPU and CPU preventing it from ever stopping losing a lot on HW), but that corporate-level stuff allowed MS to hide at a first glance for years how much Win Mobile/Phone and Win CE were losing

http://www.microsoft.com/investor/reports/ar14/index.html