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Forums - Microsoft - Former MS executive: Microsoft doesn't make very much on videogames

nightsurge on 08 February 2013
VGKing said:
nightsurge said:
VGKing said:
Mr Puggsly said:
VGKing said:
Nothing really new but it should open some of these people's eyes. The Xbox business isn't this immensely profitable division for Microsoft like some make it out to be.

Well even early on it seemed like MS was primarily looking to diversify. Its clear MS didn't step in expecting big profits and continued on even after huge losses on the original Xbox. It was probably the biggest financial disaster in the industry... until PS3 rolled around.

I think most of us knew Sony before the Playstation, but putting out a game console gave them a cult following. MS accomplished the same thing with gamers via the Xbox.

Either way, it looks like the Xbox brand really has become a financially worthwhile endeavor. I presume the most profitable aspect of Xbox is those Live memberships. I've heard guesstimates as high as 20 million Gold members. If that's true, that's a nice chunk of change.

Those Xbox lIve Gold subs are extremely optimistic. I believe the last actual number we had was like 12million, and that doesn't mean these people are paying $60 a year, they could be finding sales for these, they could be paying for the 3month Gold subs. It's end-gen and I expect Gold subs to be no more than 15m.(being a bit optimistic)

The 12 million figure was almost 2 years ago.

Also, I find 15 million figure to be a lowball considering at least 14 million people have played Modern Warfare 3 online. Granted, there could be duplicates or canceled/created accounts. At least MS doesn't include those numbers to inflate their picture like Sony does lol... all MS's figures are "Active" users not total accounts ever created, duplicated, abandoned, forums, psp, ps3, PC, etc... haha

And really, the EDD (the division that houses Xbox, Zune, Windows Phone, and a few other devices) has been posting great profits for the last few years. The only device in that list that is profitable is the Xbox brand. All those other devices have been incurring losses like mad, and yet the EDD still shows ~1billion profit a year?!?! Compare that to the other 2 main gaming companies out there and see how that stacks up in recent years.

The Xbox itself is a mad money maker and if it had it's own division we would likely see profits double or more compared to the EDD division!

So you're saying all ~15million or so Xbox LIve Gold accounts are active? LOL.

Yup :) Microsoft even explicitly says this when they reveal Xbox Live member numbers. They only reveal "Active" accounts!

They are not like Sony where Sony will claim to have 80 million PSN members when of those, maybe 20 million total are even remotely active and actually related to the PS3. LOL



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VGKing on 08 February 2013
nightsurge said:
VGKing said:
nightsurge said:
VGKing said:
Mr Puggsly said:
VGKing said:
Nothing really new but it should open some of these people's eyes. The Xbox business isn't this immensely profitable division for Microsoft like some make it out to be.

Well even early on it seemed like MS was primarily looking to diversify. Its clear MS didn't step in expecting big profits and continued on even after huge losses on the original Xbox. It was probably the biggest financial disaster in the industry... until PS3 rolled around.

I think most of us knew Sony before the Playstation, but putting out a game console gave them a cult following. MS accomplished the same thing with gamers via the Xbox.

Either way, it looks like the Xbox brand really has become a financially worthwhile endeavor. I presume the most profitable aspect of Xbox is those Live memberships. I've heard guesstimates as high as 20 million Gold members. If that's true, that's a nice chunk of change.

Those Xbox lIve Gold subs are extremely optimistic. I believe the last actual number we had was like 12million, and that doesn't mean these people are paying $60 a year, they could be finding sales for these, they could be paying for the 3month Gold subs. It's end-gen and I expect Gold subs to be no more than 15m.(being a bit optimistic)

The 12 million figure was almost 2 years ago.

Also, I find 15 million figure to be a lowball considering at least 14 million people have played Modern Warfare 3 online. Granted, there could be duplicates or canceled/created accounts. At least MS doesn't include those numbers to inflate their picture like Sony does lol... all MS's figures are "Active" users not total accounts ever created, duplicated, abandoned, forums, psp, ps3, PC, etc... haha

And really, the EDD (the division that houses Xbox, Zune, Windows Phone, and a few other devices) has been posting great profits for the last few years. The only device in that list that is profitable is the Xbox brand. All those other devices have been incurring losses like mad, and yet the EDD still shows ~1billion profit a year?!?! Compare that to the other 2 main gaming companies out there and see how that stacks up in recent years.

The Xbox itself is a mad money maker and if it had it's own division we would likely see profits double or more compared to the EDD division!

So you're saying all ~15million or so Xbox LIve Gold accounts are active? LOL.

Yup :) Microsoft even explicitly says this when they reveal Xbox Live member numbers. They only reveal "Active" accounts!

They are not like Sony where Sony will claim to have 80 million PSN members when of those, maybe 20 million total are even remotely active and actually related to the PS3. LOL

What is "active"? How long does someone have to play per week to be considered active? 

and lol at your Sony dig. I'm pretty sure people have multiple accounts for a reason so most of those are indeed ACTIVE accounts. There's also this thing called the PSP and Playstation Vita. They are also counted.



J_Allard on 09 February 2013

Gold was almost at 13 million in 2010. Should be well above 15 million by now. And yeah it's not comparable to PSN, where you can have unlimited different accounts on the free service. Either way Live basically prints money for MS. I cannot imagine Sony being dumb enough to not follow suit next gen. I expect both of them to offer subscription services and both of them will offer a lot more stuff than they do this gen with their subscription services.



Nem on 09 February 2013

Aww... poor Microsoft. Maybe they should charge a fee for a service everyone offers for free. Oh wait...



VenatusRex on 09 February 2013
noname2200 said:
pokoko said:
A lot of that sounds a bit silly. Because Sony didn't want to be friends? Were they supposed to wear matching cell phone straps? Sounds way, way over-simplified.

When they say "didn't want to be friends" they mean "wanted to use the PlayStation as a trojan horse to gobble up our market, without giving us a cut." It's spelled out in the paragraph that mentions Gates by name.


I agree. Sony was a threat to microsoft, haha. The PS3 was going to drive the PC out of business. I can't stop laughing. They saw  a weak company and thought they had an easy push over, like all the other companies they drove out of business. Notice how he said he wanted to take advantage of other companies and make them lose money. That is true, and what they are trying to do to Sony.

But now the xbox sales dropped 28% since last year. With sales like that  Microsoft should be out of the gaming business soon. Then Microsoft will get what they deserve. No wonder nobody is buying their new tablet & Winddows 8, ppl are fed up with this evil, greedy company.



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Roar_Of_War on 09 February 2013

This is still true. The game industry doesn't do much for Microsoft in terms of profits. This is probably partially why a COD releases every year, too (since Microsoft has somewhat of a hold on them).



nightsurge on 10 February 2013
VGKing said:
nightsurge said:
VGKing said:
nightsurge said:
VGKing said:
Mr Puggsly said:
VGKing said:
Nothing really new but it should open some of these people's eyes. The Xbox business isn't this immensely profitable division for Microsoft like some make it out to be.

Well even early on it seemed like MS was primarily looking to diversify. Its clear MS didn't step in expecting big profits and continued on even after huge losses on the original Xbox. It was probably the biggest financial disaster in the industry... until PS3 rolled around.

I think most of us knew Sony before the Playstation, but putting out a game console gave them a cult following. MS accomplished the same thing with gamers via the Xbox.

Either way, it looks like the Xbox brand really has become a financially worthwhile endeavor. I presume the most profitable aspect of Xbox is those Live memberships. I've heard guesstimates as high as 20 million Gold members. If that's true, that's a nice chunk of change.

Those Xbox lIve Gold subs are extremely optimistic. I believe the last actual number we had was like 12million, and that doesn't mean these people are paying $60 a year, they could be finding sales for these, they could be paying for the 3month Gold subs. It's end-gen and I expect Gold subs to be no more than 15m.(being a bit optimistic)

The 12 million figure was almost 2 years ago.

Also, I find 15 million figure to be a lowball considering at least 14 million people have played Modern Warfare 3 online. Granted, there could be duplicates or canceled/created accounts. At least MS doesn't include those numbers to inflate their picture like Sony does lol... all MS's figures are "Active" users not total accounts ever created, duplicated, abandoned, forums, psp, ps3, PC, etc... haha

And really, the EDD (the division that houses Xbox, Zune, Windows Phone, and a few other devices) has been posting great profits for the last few years. The only device in that list that is profitable is the Xbox brand. All those other devices have been incurring losses like mad, and yet the EDD still shows ~1billion profit a year?!?! Compare that to the other 2 main gaming companies out there and see how that stacks up in recent years.

The Xbox itself is a mad money maker and if it had it's own division we would likely see profits double or more compared to the EDD division!

So you're saying all ~15million or so Xbox LIve Gold accounts are active? LOL.

Yup :) Microsoft even explicitly says this when they reveal Xbox Live member numbers. They only reveal "Active" accounts!

They are not like Sony where Sony will claim to have 80 million PSN members when of those, maybe 20 million total are even remotely active and actually related to the PS3. LOL

What is "active"? How long does someone have to play per week to be considered active? 

and lol at your Sony dig. I'm pretty sure people have multiple accounts for a reason so most of those are indeed ACTIVE accounts. There's also this thing called the PSP and Playstation Vita. They are also counted.

Active is used within the last month. I highly doubt the majority of PSN accounts are qualifying as active. Especially since they are free. Anyone can make a new account to reset their stats in a game like Call of Duty with no loss or penalty. And you have to have a PSN account just to use Sony forums on the web. That's just silly. The PSP and Vita references were merely that Sony obviously uses multiple platforms to obtain their numbers while MS only uses Xbox numbers. Imagine if they lumped in all the windows live accounts that were ever made! Wholy mackerole!



FinalEvangelion on 10 February 2013

I've known this. It's pretty much a drop in the bucket in their finances. The shareholders have never cared too much what the Xbox division is doing - or whether it's there or not. I don't think Steve Ballmer even cares too much what the guys over at the Xbox division are doing except when it was hemorrhaging tons of money like the first one.



"Naturally the common people don't want war: Neither in Russia, nor in England, nor for that matter in Germany. That is understood. But, after all, IT IS THE LEADERS of the country who determine the policy and it is always a simple matter to drag the people along, whether it is a democracy, or a fascist dictatorship, or a parliament, or a communist dictatorship. Voice or no voice, the people can always be brought to the bidding of the leaders. That is easy. All you have to do is TELL THEM THEY ARE BEING ATTACKED, and denounce the peacemakers for lack of patriotism and exposing the country to danger. IT WORKS THE SAME IN ANY COUNTRY."  --Hermann Goering, leading Nazi party member, at the Nuremberg War Crime Trials 

 

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theprof00 on 10 February 2013

I've been saying this for years and have actually encountered much resistance.



EspadaGrim on 10 February 2013

This guy has not been with Microsoft since 2003 he is only saying this crap to publicize his upcoming book.