XBOX |OT|

[JRPGfan]

G2ThaUNiT said:

JRPGfan said:

Have you guys seen this yet :
https://www.windowscentral.com/gaming/xbox/inside-xboxs-margin-crush

"To make matters worse, Xbox struggled to secure anywhere near enough memory with fixed prices necessary to keep its hardware margins healthy. I'm told Xbox is losing not dozens, but more in the hundreds of dollars per Xbox Series X|S console sold right now,"- Jez Corden 

That is nuts. After the price increases, it is still losing 100's of dollars on each console in subsidies...

This goes into the more than 20 billion investment in the past 5 years, and still losing half a billion in revenue annually quote by Sasha Sharma.

Imagine buying ABK for $76 bn. and using a extra $20 bn, trying to prop up the xbox ecosystem.... and revenue drops (thats almost $100bn total)
You basically burnt $20 bn for nothing... while your competition is saying "this is our most profitable generation ever!" 

How the hell did Phil Spencer, last as long as he did?

This coincides with my post yesterday. Phil and co several years ago decided to turn Xbox into a software-focused company and intentionally stripped back console manufacturing in favor of "This is an Xbox" with the console just being one of many options. Which means they weren't making anywhere near as many orders as Sony or Nintendo were during that transitional time, which happened over the course of the last few years.

Then, once it became apparent that Phil's bet on Netflix of gaming, and This is an Xbox weren't going to be the successes he had hoped for, the component shortages started happening. And because of Xbox dramatically scaling back manufacturing for several years, Sony, Nintendo, and all other major tech companies had already secured their positions of having more availability of components, even though still at a higher cost.

And being in a time of scarcity, it's whoever secures the most orders. A process that takes months, if not years. So because Xbox is in no position to outbid other companies, they have to pay a higher premium for smaller orders.

A perfect storm of poor decision making and bad luck.

Dude Phil rolled a twenty sided dice, and landed a "1" (critical failure).

Crazy random unlucky streak.