I read that the original Xbox lost them about 4 billion and the 360 lost money for the first 3 years.

Going a little off topic but I like how you pointed out Netflix.  Company took huge losses on their stock for awhile because of the whole debacle.  Netflix is now stronger than ever since they stayed as one company (plus the name Flixster or whatever the hell it was a terrible name).  I believe I cancelled my subscription right when the split was announced in an email by the CEO (along with a decent amount of other subscribers).  They then had to send out a letter of an apology from the CEO about the whole thing pretty much begging people to come back but expect to pay double for 1 dvd rental with streaming.  So most people went streaming only but they probably have a decent amount of people that still do the dvd rental.

On topic: Funny that the USA government at one point tried to bust up Microsoft because they were so dominate back in the 90s.  That would have been interesting but Microsoft is definitely better off staying as one.  Sure some of their products are bombs or don't sell that much but they still are kings of the OS for now.  If I was an investor of Microsoft I would rather have them just focus less on producing Surface tablets and more focus on the game division.  They probably haven't made a net profit since entering the video game business but they damn sure better stick around since they are finally seeing some green and have a decent size user base.  There is no reason to sell off the Xbox division now.

Might be a lot of money in smartphone gaming but a lot of companies go big then bust (look at Rovio and Zynga).  I know for sure Zynga has closed some offices and laid people off and I am pretty sure Rovio has done the same recently.  Almost every week a few weeks back you would see in VGC news a studio closing down related to smartphone gaming.  Sure there are always boons and then there busts when it comes to emerging markets.  However, most of these companies are expand too big (without generating enough hits to support themselves) and then don't generate the revenue like they used to because they fill their games with full screen ads (I'm pretty sure Angry Birds does this on Android for free versions).  People eventually get pissed off and stop playing their games (or get smart and play in offline mode).  Anyways, sure there is a lot of money in smartphone gaming but there are tons of companies that generate profit then go into the red.  The smartphone gaming market has a lot more failures than success stories right now and even the success aren't doing that great right now.  Name me a company that is solid that is 100% involved in smart phone gaming.

lol those guys make me laugh....
the thing is if windows wants to survive it needs more markets than just the PC.... for that they have not many options.... portable device and entertainment device....

while tablets might be the most logic one, it is struggling way more than the XB brand.... then you have phones... same results a little better maybe but still....
bottom line I think XB is the best unifying platform on the long run and could help push other products through inter connectivity....

when MS will run the same OS kernel on all platform this will make complete sense.... you buy or get an app that is compatible with all your device... and can network all your data through the cloud local or online....

I think for any company dealing in computers it is / will be essential to have a spot next to the TV/internet box where more and more people have their NAS they use for all their devices....

people use less and less computer in a home office with a PC... and more and more in their living room while consuming media, because ultra portability enabled that....

so yeah they might get what they want but in the long run it will more than likely prove to be a mistake.... if it was that stupid why google and apple and other brands are trying so hard to have a device connected to your TV ??? because TVs are the main screen in a house...

and finally to sell something you need a buyer... so unless apple or google wants to fork out the cash I don't see who would buy it... steam maybe but I doubt it...

but if it happens I'll do like I did when sega DC went south I'll go in console gaming hibernation

LOL wat movie is that from? Anyway how ironic would it be if Apple ended up buying it.

I see, so instead of losing money like what happened to Sony. The Xbox have yet to recoup theirs.

Since they only own 1% stage of MS they have pretty much a zero percent change of forcing MS to sell off the XBOX division as for Balmer he already said he plans to retire soon.

Wouldnt mind if microsoft sold Xbox division. Atleast third party games would actually be multiplatform then.

MS doesn't have that much in the way of profitable divisions as far as I know, it's just the application division turning serious cash.

The Console aspect was actually more to ensure they "kept up" with the likes of Sony to ensure they didn't find a way to make Windows etc obsolete with the "Super Computer" power of PS2. As if consoles in the front room replaced PCs for domestic applications, their core business would have been nuked.

Spending a couple of billion $ (and now actually generating some returns) ensureing a mega multi billion $ part of your business is secure is a worthwhile investment.

I think this shareholder is just a bit short sighted to see that and MS kind of missed the threat from mobile devices such as iOS/Android which really shows just how important it is to keep up with potential future rivals as much as current direct rivals.