Firstly, don't take this thread the wrong way. I'm providing different hypotheticals as to what the outcome would have been like. I like my Xbox, but I would like to know....

Could Microsoft have done better with the investment they put towards the Xbox for something else?

That is, should Microsoft have not considered making the Xbox at all, and focused on another department?

Let me explain this. Think back to 2000. Windows XP was soon to be released. Microsoft had the entire PC gaming industry sewn up with the use of programming APIs like DirectX, which allowed effective communication between software and hardware without too much interference from the OS. You could say that Windows should have stuck to its rails and not changed. So why did Microsoft choose the way they did? Perhaps they saw Sony as a threat to their business model?  Perhaps they were ready to enter the home theatre market and expand. I've thought about this a lot, and I'm starting to wonder if Microsoft's plan was a net positive for them or not.

For starters, Microsoft encouraged a few PC developers to start development on the Xbox. Effectively, they took developers from a market which they dominated and put it in a market that it wasn't dominating. Places such as Bungie now develop for other systems other than Microsoft. Perhaps Bungie would still be developing on the PC otherwise?

Secondly, how about PC gamers? A lot got newly introduced to console gaming with the original Xbox, once again moving some consumers from a market that Microsoft dominated to one they were behind in, marketwise. Surely a few of these gamers grew attached to console gaming and have since "dabbled in the black arts" of Microsoft's competitors?

Fast forward to today, we have iOS and Android giving Windows a run for its money with smart devices. Microsoft are late to the party to introduce Windows 8 for the devices (I'm reserved in Microsoft's decision to make Windows more "smart device" friendly. Once again, changing a market they're dominating in), and on the other hand, you have cloud based services such as Steam snatching up the digital distribution market. So was Microsoft's Xbox decision the right one, or should they have focused on other markets that would have been a threat to Windows?

Those were my two "alternative" thoughts; Microsoft could have developed a cloud based market like Steam, beating them to the game. Not only that, but it could have been distributed as part of Windows! I think that could have been an easy market for Microsoft to win.

The other option was to try and beat Apple to the punch with the smart devices. they had Windows CE and Windows Mobile, but they required a lot more effort than was put into them. I cannot help but think that Microsoft looked at the Palmpilot market and figured it was going to go nowhere. A smartphone with promise of full Windows communication before Apple hit the market might have taken a LARGE chunk of Apple's marketshare, especially with the more business oriented types.

So what is everyone's thoughts on the matter?

Wasn't the Xbox made just to stop the progress of OpenGL?

Personally, I think they should've moved into the mobile market a LOT sooner, I think not even Microsoft predicted the surge of OS using smartphones.

As for the Xbox itself? I think it was a good thing overall. Competition between Sony and MS. (Nintendo just being Nintendo)

Tablets, they had a decade ago, should've continued developing from there instead of missing the boat with the Surface.

MS rarely is the first out of the gate. They like to innovate on what's been done. Sometimes that means they are late, but in the long run they usually come out on top. Windows 8 is the mobile OS that the other mobile OS's promised they would be and never lived up to it. Windows 8's app store is both a competitor to Steam and Apple/Android's app stores.

As for Xbox. MS has been upfront from the beginning that the Xbox was put on the market to stop Sony from taking over the living room. It worked.

Too early to tell. Come back in 5 years.

Well that's a thought.....if OpenGL became popular, it would have meant worry on the Windows side of things. Would explain why they originally called it "DirectX box"

Fortunately for Microsoft, OpenGL got stuck on a major version (version 2 I believe it was), for far too long than it should have, and things like shader support were not incorporated for a long time after DirectX.

Yeah just remember reading somewhere that Sony refused to use DirectX with PS2 or something.

Possiblity why they decided to go with Cell with PS3 as well they wanted to say no to MS.

Looks like they finally caved.

That's all well and good, but I really wish that Microsoft specialised the mobile OS experience, rather than trying to make a Windows version "take a bite out of everything". I might sound like an old fogey, but I'm a bit concerned about this alienating path Microsoft is taking that makes the desktop experience seem....weird, just for the sake of mobile device compatibility....

As for the Windows 8 store, that really should have had an implementation by Windows Vista, or ideally, one of the XP service packs...their PC dominance as well as their influence to add it to their own OS, developers would be falling over each other to have had the chance to market their software on it...

DirectX would still need to be taken into consideration when the kernel is developed. IIRC, the Xbox had a cut down Windows 2000 kernel in it, so DirectX was an obvious progressive step for them.

If Sony was genuinely interested in ease of development, they'd make their development tools fully compatible in Visual Studio and use DirectX as a wrapper (though it's translated at compile time, so developers keep the ease of DirectX while maintaining an efficient build binary for the PS4.)

Too early to tell imho. But with the profits the 360 brought in and the strides they have made, dominating the US market like they did, I'm inclined to say no.