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Forums - Sales Discussion - Is the Kinect boost to the Xbox 360 an illusion?

robzo100 on 19 February 2011

I think it's an illusion, but only right now.  It's been out for only like 4 months.  Wii didn't have any killer apps outside of the bundled game until a whiles in, certainly longer than four months.

When Wii was selling off the charts at the beggining of the generation people were calling it a farce, but once the 20 million sellers started to come they finally accepted it.  I'll do the same thing.  I'm calling this a farce until I see software sales that change my mind.

Though I'll still certainly stick to the fact that MS made a good decision with pursuing this new direction with Kinect.



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TheWon on 19 February 2011
Mummelmann said:
Metallicube said:

It never ceases to amaze me how passionately people here defend a hardware add on. I just look at those games and, I cannot understand it.. Boggles the mind.

I mean do people here really WANT games like that? Or to play games without a controller?


It never ceases to amaze me how a lot of people desperately defend everything Malstrom says, no matter how silly it is. He's been slowly decomposing as a writer and "analyst" and has now reached the ripe state, this article is pure tosh from beginning to end and is very obviously an angry man who is displeased that games and concepts he does not approve of are doing well and that the industry never took the turn he wanted and said that it would. He is being the thing he hates the most; an enraged fanboy who throws tantrums when things aren't going his way.

In regards to your last sentence; I can't believe that people WANT games like Wii Fit or Carnival Games or Cooking Mama but they still sell and it is of no consequence to me. No one is forcing me to play them.

You are attacking Kinect like others have attacked the Wii for years, something you have scorned them greatly for. Keep your wits about you.


This is the sad state that gaming is in this generation. Everyone wants to be on the winning team. Go to Gametrailers and read all the comments of supporters of Patcher. Who without a doubt has been the worst analyst of all time this generation. Yet their are people who will defend his opinion, and the right for him to say it. Malstrom, Patcher, and may others are the same type of person. To people who really see them for who they are. For those who support them. As long as they keep saying what they want to hear. They will let their wrong comments fall to the way side.



 

Just because someone is saying something different. Doesn't mean their point of view is right!

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One of the 4 Yonkou of Youtube aka Wii Warlords. Other Members include ThaBlackBaron, Shokio, and Cardy.

Mummelmann on 20 February 2011
TheWon said:
Mummelmann said:
Metallicube said:

It never ceases to amaze me how passionately people here defend a hardware add on. I just look at those games and, I cannot understand it.. Boggles the mind.

I mean do people here really WANT games like that? Or to play games without a controller?


It never ceases to amaze me how a lot of people desperately defend everything Malstrom says, no matter how silly it is. He's been slowly decomposing as a writer and "analyst" and has now reached the ripe state, this article is pure tosh from beginning to end and is very obviously an angry man who is displeased that games and concepts he does not approve of are doing well and that the industry never took the turn he wanted and said that it would. He is being the thing he hates the most; an enraged fanboy who throws tantrums when things aren't going his way.

In regards to your last sentence; I can't believe that people WANT games like Wii Fit or Carnival Games or Cooking Mama but they still sell and it is of no consequence to me. No one is forcing me to play them.

You are attacking Kinect like others have attacked the Wii for years, something you have scorned them greatly for. Keep your wits about you.


This is the sad state that gaming is in this generation. Everyone wants to be on the winning team. Go to Gametrailers and read all the comments of supporters of Patcher. Who without a doubt has been the worst analyst of all time this generation. Yet their are people who will defend his opinion, and the right for him to say it. Malstrom, Patcher, and may others are the same type of person. To people who really see them for who they are. For those who support them. As long as they keep saying what they want to hear. They will let their wrong comments fall to the way side.


Yeah but Vgchartz really isn't bad at all when it comes to this. Especially compared to Gametrailers and Gamespot and similar sites. This is the only site I post on where I actually still like and respect even the users I disagree with!



Aielyn on 20 February 2011
d21lewis said:

A couple of things:

  • From what I understand, the $500 million is the entire marketing budget, not the Kinect marketing budget.
  • Selling the console isn't where the bulk of the money is made.  Kinects cost next to nothing to make.  Also, game sales are where consoles make their money.  It's the "Razor blade" model.  You lose money on the "razor" and make money on the "blades".
  • Without the marketing, new re-design, and Kinect, who's to say how bad 360 sales would be?  Certainly not as good as they are, now.   It would probably be like the other consoles on the market--at a decrease for the year.
  • It said in the article that M$'s increase was 1,148,500 consoles over a set period of time where it could have been 1,666,666 if they'd just taken their marketing money and bought 360's with it over the same period of time.  It's not like 360 sales are going to suddenly stop.  With the money spent marketing, I can only assume that more people are aware of 360's and Kinect and more consoles will sell in the future as a result.  Spending a large amount of money now to make more money later--that's how businesses work, right?  I guess Coca Cola shouldn't have advertised at the Superbowl.  Instead, they should have taken their millions of dollars and bought Coca Cola with it.  That way, sales would improve because they bought their own.......no.  That's fucking retarded.

  • Does it matter? The point is, MS spent $500 million, and this is all they got out of it.
  • Kinects cost next to nothing... but we're talking about sales of Xbox 360s. Kinect is just bundled in with it. As for the razor-and-blades argument, I'll just point out that the "blades" still don't make a huge amount of profit in gaming, unless they sell in huge numbers (especially on the 360 and PS3, where dev costs are very high). The 360 still isn't selling as many games a week as the Wii is.
  • So what you're saying is that "hardcore" gaming is dying, with all consoles seeing declines, and the only thing that saved the 360 from the decline was Kinect and its "casual" lineup? It's your choice.
  • Well done, you missed the whole point of the description. It wasn't that MS should have bought 1.7 million of their own systems, but that they could have done so, and seen more from it. When you consider the much, much smaller profit they make from the sales of an Xbox 360 than the full price of it, you're talking not a lot of "profit" at all - the point is that they'd have made more profit off buying their own system, which is to say, the money was wasted, since obviously buying your own product is a bad idea, and doesn't make you any profit.
  • Most importantly, this is only discussing the advertising campaign. Nobody has yet factored in the cost of development.


UncleScrooge on 20 February 2011

Malstrom is really throwing around some stupid stuff lately.

Here's the catch: Malstrom is extremely good at explaining what disruptive technologies are. And his posts were simply amazing as long as he simply explained what Christensen wrote in his books. He's got a great understanding of disruption. Unfortunately, he doesn't really know when to apply disruption and when not. He's so focused on it he flat out rejects to consider other fundamental business theories which leads me to believe "The innovator's dilemma" is the only book he read about business. The same goes for things like "financial education". All he wrote about financial education was pretty much copy-pasted from Robert Kuyasaki (or whatever his name was) who wrote a rather famous book called "Rich Dad, Poor Dad". Unlike the authors of these books Malstrom fails to take into account that these theories only apply in very special cases and were never meant to be fundamental to one's understanding of economy / financial education. He does the same with his politics posts. His understanding of voting intentions, polls and the outcome of elections is rather limited and so far he has been flat out wrong with each of his predictions. He just happens to pack them in fluffy words while he really is just a republican voter who wants "his" party to win.

That being said it would be quite shocking to see him stick to his (blog-) roots when he gets so much attention from people. Unfortunately his popularity lead to some people just repeating what Malstrom says over and over again even if there is no reason to believe what he says is true.

I still think he's a cool guy though, to be honest



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thx1139 on 20 February 2011
Aielyn said:
d21lewis said:

A couple of things:

  • From what I understand, the $500 million is the entire marketing budget, not the Kinect marketing budget.
  • Selling the console isn't where the bulk of the money is made.  Kinects cost next to nothing to make.  Also, game sales are where consoles make their money.  It's the "Razor blade" model.  You lose money on the "razor" and make money on the "blades".
  • Without the marketing, new re-design, and Kinect, who's to say how bad 360 sales would be?  Certainly not as good as they are, now.   It would probably be like the other consoles on the market--at a decrease for the year.
  • It said in the article that M$'s increase was 1,148,500 consoles over a set period of time where it could have been 1,666,666 if they'd just taken their marketing money and bought 360's with it over the same period of time.  It's not like 360 sales are going to suddenly stop.  With the money spent marketing, I can only assume that more people are aware of 360's and Kinect and more consoles will sell in the future as a result.  Spending a large amount of money now to make more money later--that's how businesses work, right?  I guess Coca Cola shouldn't have advertised at the Superbowl.  Instead, they should have taken their millions of dollars and bought Coca Cola with it.  That way, sales would improve because they bought their own.......no.  That's fucking retarded.

  • Does it matter? The point is, MS spent $500 million, and this is all they got out of it.
  • Kinects cost next to nothing... but we're talking about sales of Xbox 360s. Kinect is just bundled in with it. As for the razor-and-blades argument, I'll just point out that the "blades" still don't make a huge amount of profit in gaming, unless they sell in huge numbers (especially on the 360 and PS3, where dev costs are very high). The 360 still isn't selling as many games a week as the Wii is.
  • So what you're saying is that "hardcore" gaming is dying, with all consoles seeing declines, and the only thing that saved the 360 from the decline was Kinect and its "casual" lineup? It's your choice.
  • Well done, you missed the whole point of the description. It wasn't that MS should have bought 1.7 million of their own systems, but that they could have done so, and seen more from it. When you consider the much, much smaller profit they make from the sales of an Xbox 360 than the full price of it, you're talking not a lot of "profit" at all - the point is that they'd have made more profit off buying their own system, which is to say, the money was wasted, since obviously buying your own product is a bad idea, and doesn't make you any profit.
  • Most importantly, this is only discussing the advertising campaign. Nobody has yet factored in the cost of development.

Comical.

The marketing plan isnt over. All the funds havent been spent and the marketing was for all of Xbox not simply Kinect.  Of course the whole centerpiece of Xbox marketing has been Kinect since October.

The sales havent stopped. In January 3 out of 5 360s sold were with Kinect so the marketing is working and continuing to work.   The point of marketing anyway isnt for the sales to stop when the marketing stops, then it would be a failure. The point is to drive an image to the market and awareness so the sales continue.

Buying the consoles themselves would not have sold the over 5 million standalone Kinects sold since November. Buying the consoles themselves would not have sold the software sold since November (about 8 million not counting Kinect Adventures).

The new customers are far more likely to purchase hardcore games now that they have a 360, they are far more likely to join Xbox Live, they are far more likely to start using Netflix, Zune, etc. 

As for software sales (where people actually pay money for software) 360 and Wii are nearly the same and how many more Wii's have been sold over time. Hmm over 30 million.



Its libraries that sell systems not a single game.

d21lewis on 20 February 2011
Aielyn said:
d21lewis said:

A couple of things:

  • From what I understand, the $500 million is the entire marketing budget, not the Kinect marketing budget.
  • Selling the console isn't where the bulk of the money is made.  Kinects cost next to nothing to make.  Also, game sales are where consoles make their money.  It's the "Razor blade" model.  You lose money on the "razor" and make money on the "blades".
  • Without the marketing, new re-design, and Kinect, who's to say how bad 360 sales would be?  Certainly not as good as they are, now.   It would probably be like the other consoles on the market--at a decrease for the year.
  • It said in the article that M$'s increase was 1,148,500 consoles over a set period of time where it could have been 1,666,666 if they'd just taken their marketing money and bought 360's with it over the same period of time.  It's not like 360 sales are going to suddenly stop.  With the money spent marketing, I can only assume that more people are aware of 360's and Kinect and more consoles will sell in the future as a result.  Spending a large amount of money now to make more money later--that's how businesses work, right?  I guess Coca Cola shouldn't have advertised at the Superbowl.  Instead, they should have taken their millions of dollars and bought Coca Cola with it.  That way, sales would improve because they bought their own.......no.  That's fucking retarded.

  • Does it matter? The point is, MS spent $500 million, and this is all they got out of it.
  • Kinects cost next to nothing... but we're talking about sales of Xbox 360s. Kinect is just bundled in with it. As for the razor-and-blades argument, I'll just point out that the "blades" still don't make a huge amount of profit in gaming, unless they sell in huge numbers (especially on the 360 and PS3, where dev costs are very high). The 360 still isn't selling as many games a week as the Wii is.
  • So what you're saying is that "hardcore" gaming is dying, with all consoles seeing declines, and the only thing that saved the 360 from the decline was Kinect and its "casual" lineup? It's your choice.
  • Well done, you missed the whole point of the description. It wasn't that MS should have bought 1.7 million of their own systems, but that they could have done so, and seen more from it. When you consider the much, much smaller profit they make from the sales of an Xbox 360 than the full price of it, you're talking not a lot of "profit" at all - the point is that they'd have made more profit off buying their own system, which is to say, the money was wasted, since obviously buying your own product is a bad idea, and doesn't make you any profit.
  • Most importantly, this is only discussing the advertising campaign. Nobody has yet factored in the cost of development.


Wow.  You beat me.

*edit*  Thanks, THX 1139.  Lately, I find it easier to just ignore posts like that rather than try to argue with them.



silicon on 20 February 2011
thx1139 said:
Aielyn said:
d21lewis said:

A couple of things:

  • From what I understand, the $500 million is the entire marketing budget, not the Kinect marketing budget.
  • Selling the console isn't where the bulk of the money is made.  Kinects cost next to nothing to make.  Also, game sales are where consoles make their money.  It's the "Razor blade" model.  You lose money on the "razor" and make money on the "blades".
  • Without the marketing, new re-design, and Kinect, who's to say how bad 360 sales would be?  Certainly not as good as they are, now.   It would probably be like the other consoles on the market--at a decrease for the year.
  • It said in the article that M$'s increase was 1,148,500 consoles over a set period of time where it could have been 1,666,666 if they'd just taken their marketing money and bought 360's with it over the same period of time.  It's not like 360 sales are going to suddenly stop.  With the money spent marketing, I can only assume that more people are aware of 360's and Kinect and more consoles will sell in the future as a result.  Spending a large amount of money now to make more money later--that's how businesses work, right?  I guess Coca Cola shouldn't have advertised at the Superbowl.  Instead, they should have taken their millions of dollars and bought Coca Cola with it.  That way, sales would improve because they bought their own.......no.  That's fucking retarded.

  • Does it matter? The point is, MS spent $500 million, and this is all they got out of it.
  • Kinects cost next to nothing... but we're talking about sales of Xbox 360s. Kinect is just bundled in with it. As for the razor-and-blades argument, I'll just point out that the "blades" still don't make a huge amount of profit in gaming, unless they sell in huge numbers (especially on the 360 and PS3, where dev costs are very high). The 360 still isn't selling as many games a week as the Wii is.
  • So what you're saying is that "hardcore" gaming is dying, with all consoles seeing declines, and the only thing that saved the 360 from the decline was Kinect and its "casual" lineup? It's your choice.
  • Well done, you missed the whole point of the description. It wasn't that MS should have bought 1.7 million of their own systems, but that they could have done so, and seen more from it. When you consider the much, much smaller profit they make from the sales of an Xbox 360 than the full price of it, you're talking not a lot of "profit" at all - the point is that they'd have made more profit off buying their own system, which is to say, the money was wasted, since obviously buying your own product is a bad idea, and doesn't make you any profit.
  • Most importantly, this is only discussing the advertising campaign. Nobody has yet factored in the cost of development.

Comical.

The marketing plan isnt over. All the funds havent been spent and the marketing was for all of Xbox not simply Kinect.  Of course the whole centerpiece of Xbox marketing has been Kinect since October.

The sales havent stopped. In January 3 out of 5 360s sold were with Kinect so the marketing is working and continuing to work.   The point of marketing anyway isnt for the sales to stop when the marketing stops, then it would be a failure. The point is to drive an image to the market and awareness so the sales continue.

Buying the consoles themselves would not have sold the over 5 million standalone Kinects sold since November. Buying the consoles themselves would not have sold the software sold since November (about 8 million not counting Kinect Adventures).

The new customers are far more likely to purchase hardcore games now that they have a 360, they are far more likely to join Xbox Live, they are far more likely to start using Netflix, Zune, etc. 

As for software sales (where people actually pay money for software) 360 and Wii are nearly the same and how many more Wii's have been sold over time. Hmm over 30 million.

Not sure why people think Kinect costs next to nothing to make, when before they announced the price there was a lot of talk about whether or not they'll be selling at a loss.

But yeah, they're building the Brand.



d21lewis on 20 February 2011
silicon said:
thx1139 said:
Aielyn said:
d21lewis said:

A couple of things:

  • From what I understand, the $500 million is the entire marketing budget, not the Kinect marketing budget.
  • Selling the console isn't where the bulk of the money is made.  Kinects cost next to nothing to make.  Also, game sales are where consoles make their money.  It's the "Razor blade" model.  You lose money on the "razor" and make money on the "blades".
  • Without the marketing, new re-design, and Kinect, who's to say how bad 360 sales would be?  Certainly not as good as they are, now.   It would probably be like the other consoles on the market--at a decrease for the year.
  • It said in the article that M$'s increase was 1,148,500 consoles over a set period of time where it could have been 1,666,666 if they'd just taken their marketing money and bought 360's with it over the same period of time.  It's not like 360 sales are going to suddenly stop.  With the money spent marketing, I can only assume that more people are aware of 360's and Kinect and more consoles will sell in the future as a result.  Spending a large amount of money now to make more money later--that's how businesses work, right?  I guess Coca Cola shouldn't have advertised at the Superbowl.  Instead, they should have taken their millions of dollars and bought Coca Cola with it.  That way, sales would improve because they bought their own.......no.  That's fucking retarded.

  • Does it matter? The point is, MS spent $500 million, and this is all they got out of it.
  • Kinects cost next to nothing... but we're talking about sales of Xbox 360s. Kinect is just bundled in with it. As for the razor-and-blades argument, I'll just point out that the "blades" still don't make a huge amount of profit in gaming, unless they sell in huge numbers (especially on the 360 and PS3, where dev costs are very high). The 360 still isn't selling as many games a week as the Wii is.
  • So what you're saying is that "hardcore" gaming is dying, with all consoles seeing declines, and the only thing that saved the 360 from the decline was Kinect and its "casual" lineup? It's your choice.
  • Well done, you missed the whole point of the description. It wasn't that MS should have bought 1.7 million of their own systems, but that they could have done so, and seen more from it. When you consider the much, much smaller profit they make from the sales of an Xbox 360 than the full price of it, you're talking not a lot of "profit" at all - the point is that they'd have made more profit off buying their own system, which is to say, the money was wasted, since obviously buying your own product is a bad idea, and doesn't make you any profit.
  • Most importantly, this is only discussing the advertising campaign. Nobody has yet factored in the cost of development.

Comical.

The marketing plan isnt over. All the funds havent been spent and the marketing was for all of Xbox not simply Kinect.  Of course the whole centerpiece of Xbox marketing has been Kinect since October.

The sales havent stopped. In January 3 out of 5 360s sold were with Kinect so the marketing is working and continuing to work.   The point of marketing anyway isnt for the sales to stop when the marketing stops, then it would be a failure. The point is to drive an image to the market and awareness so the sales continue.

Buying the consoles themselves would not have sold the over 5 million standalone Kinects sold since November. Buying the consoles themselves would not have sold the software sold since November (about 8 million not counting Kinect Adventures).

The new customers are far more likely to purchase hardcore games now that they have a 360, they are far more likely to join Xbox Live, they are far more likely to start using Netflix, Zune, etc. 

As for software sales (where people actually pay money for software) 360 and Wii are nearly the same and how many more Wii's have been sold over time. Hmm over 30 million.

Not sure why people think Kinect costs next to nothing to make, when before they announced the price there was a lot of talk about whether or not they'll be selling at a loss.

But yeah, they're building the Brand.


Because there was an article last year saying Kinects cost about $60 to make.  They sell for $150.



heruamon on 20 February 2011

12 million by E3...yup...no illusion here, considering that it is a $149 peripheral.



"...You can't kill ideas with a sword, and you can't sink belief structures with a broadside. You defeat them by making them change..."

- From By Schism Rent Asunder