Gamer1211: Recently VGChartz member NJ5 posted a thread about this generation's war being over, and the result is essentially a tie. The more you consider this position, the stronger it feels. First, you have to realize that the main reason to care about how good your console is doing relative to other consoles is because you want more good games released on your console, and not because you love some company or because you want to validate your purchase. Here are the main points:

*****

- The Xbox 360 has a ~ 6.5 million unit lead over the PS3. It has sold about 54% more units than the PS3 has world wide.

- The PS3 is currently outselling the 360 world wide at a good pace, and the pace has been increasing

- The PS3 won't likely pass the 360 until mid 2009 at best. Once this happens, they'll have a gap closer than the current gap for a very long time, probably at least two years. A 50% lead may never be attained again this generation.

*****

Assume that the statements and rumors we've heard about multiplatform development are true: that porting a game costs 10-20% as much as the initial development. That means that right now, barring other financial incentives, it makes financial sense to port every single game. And since the companies making the games don't love either MS or Sony, they'll do what makes financial sense as well as they're equipped.

And if you look around, that's exactly what's happening. This benefits MS and hurts Sony in general, as we see a lot of Sony big name PS2 exclusives (including the biggest, GTA) moving multiplatform.

However, MS is far from being profitable with their Xbox division, and it's unclear whether or not they can make a single year of profit without writing off the extremely high cost of Xbox 360 repairs. They recently reported their first year of profitability with Xbox division, with 6.6 billion of losses to cover yet according to MS' own accounting, but they did not count the cost of 360 repairs in their most recent financial report.

Look at it this way: Sony fumbled the ball very badly with the PS3 for two years. One year of delays, another year of broken promises, sky high prices, and much lower than expected sales. Microsoft failed to capitalize in part due to their own fumbling. Nintendo capitalized, and look at where they are.

MS must be more than a little frustrated because generation 2 was supposed to bring the Xbox project to profitability and cover the losses of setup with the original Xbox.  Right now, they're 6.6 billion dollars away from this goal and no clear way of getting there.  One thing that is virtually assured is that they'll end this generation 5 billion or behind their original stated goal for this generation (breaking even / profitability).

First off, welcome to the forum. As for your question, while the 360 is far from "dead" in fact, its currently suffering a severe image problem. Recall that last year the PS3 was "dead", and that there were scattered calls for Sony to leave the market. Now, it's narrowly beating the 360 in sales. This turnabout makes it harder to say that the PS3 is dead, and lord knows you can't say that about the Wii, so now its the 360's turn to be the "loser."
My advice is to just brush those statements and predictions off. Even if current trends continued, the 360 would enjoy a decent life. And as Sony just finished proving, the tide can change without notice, so who's to say we won't have three friggin' threads saying that Sony is dead this time next year?

TheBigFatJ said: Gamer1211: Recently VGChartz member NJ5 posted a thread about this generation's war being over, and the result is essentially a tie. The more you consider this position, the stronger it feels. First, you have to realize that the main reason to care about how good your console is doing relative to other consoles is because you want more good games released on your console, and not because you love some company or because you want to validate your purchase. Here are the main points: ***** - The Xbox 360 has a ~ 6.5 million unit lead over the PS3. It has sold about 54% more units than the PS3 has world wide. - The PS3 is currently outselling the 360 world wide at a good pace, and the pace has been increasing - The PS3 won't likely pass the 360 until mid 2009 at best. Once this happens, they'll have a gap closer than the current gap for a very long time, probably at least two years. A 50% lead may never be attained again this generation. ***** Assume that the statements and rumors we've heard about multiplatform development are true: that porting a game costs 10-20% as much as the initial development. That means that right now, barring other financial incentives, it makes financial sense to port every single game. And since the companies making the games don't love either MS or Sony, they'll do what makes financial sense as well as they're equipped. And if you look around, that's exactly what's happening. This benefits MS and hurts Sony in general, as we see a lot of Sony big name PS2 exclusives (including the biggest, GTA) moving multiplatform. However, MS is far from being profitable with their Xbox division, and it's unclear whether or not they can make a single year of profit without writing off the extremely high cost of Xbox 360 repairs. They recently reported their first year of profitability with Xbox division, with 6.6 billion of losses to cover yet according to MS' own accounting, but they did not count the cost of 360 repairs in their most recent financial report. I agree with Rocketpig on this one. If you're Microsoft, you gotta be pretty happy with yourself. They took on Sony domination, and did pretty well for themselves. They've gone from also-rans to solid competitor. Look at it this way: Sony fumbled the ball very badly with the PS3 for two years. One year of delays, another year of broken promises, sky high prices, and much lower than expected sales. Microsoft failed to capitalize in part due to their own fumbling. Nintendo capitalized, and look at where they are. MS must be more than a little frustrated because generation 2 was supposed to bring the Xbox project to profitability and cover the losses of setup with the original Xbox. Right now, they're 6.6 billion dollars away from this goal and no clear way of getting there. One thing that is virtually assured is that they'll end this generation 5 billion or behind their original stated goal for this generation (breaking even / profitability).

MS didn't count the cost of repairs because they set aside an enormous amount to cover it in fiscal 2006. That amount was expected to run the life of the 360. We'll see if that's true or not in due time.

MS did fumble and they fumbled badly. But despite their fumbling, they're on track to sell more Xboxes, increase market in every major region (though Japan is still beyond pathetic), and make some kind of profit to boot. As a new entrant into this industry, they shouldn't be pleased but they can't be too disappointed either. Headway is being made and they're set up to launch before everyone else again. I suspect that many of the mistakes they made this generation will not be repeated.

As for overall profitability, that money is sunk cost. All MS can do now is make sure they continue to gain marketshare and continue to show profits from the division. I don't understand peoples' fascination with that $6b number. MS isn't the type of company to walk away from something because it failed to turn massive profits in seven years. They're one of the few long-term corporate conglomerates left in America. They aim 10-20 years down the road and the Entertainment Division is starting to make headway. That's all that should matter to them right now and I have the feeling that's the case. These financial officers aren't the type to pull the rug out from a billion dollar business just because a few fanboys have their panties in a bundle now that Sony and Nintendo are outselling the Xbox.

Welcome game1211 to vgcharts, I'm sure you'll find these forums to hopefully be more supportive than gamespot/gamefaqs forums where I used to lurk and post as well.
Your article was definitely a good effort and it looks like you took the time to find the links and reference them in, however most people besides the fanboys/ignorant folks really think the 360 is dead in the water. As an ex member of gamespot myself I can see why you would think the majority think so because those forums are plagued by fanboys and idiots. There wasn't a single day where flames wars didn't occur over consoles and blah., (wasn't a single minute more like).
Also a lot of those article are extremely dated, it's great that you know how to find information, but a lot of the more recent threads and articles (or even the weekly sales) already show that the 360 is not dead from good hardware and software sales. I hope you enjoy this forum and stay because you seem like an intelligent person with logic =)

TheBigFatJ said: I agree with Rocketpig on this one. If you're Microsoft, you gotta be pretty happy with yourself. They took on Sony domination, and did pretty well for themselves. They've gone from also-rans to solid competitor. Look at it this way: Sony fumbled the ball very badly with the PS3 for two years. One year of delays, another year of broken promises, sky high prices, and much lower than expected sales. Microsoft failed to capitalize in part due to their own fumbling. Nintendo capitalized, and look at where they are.

I agree that Sony fumbled, but it was the competition with Microsoft for a bigger and better console that caused that fumble.

There is no one I know who expected Microsoft to be in this good of a position, and Sony to be in this bad of a position at this point in the race.  Everyone assumed Sony would win again.  Of course, it's also true that without the RROD, Microsoft would be doing even better.

It won't, some day later, Microsoft will do what it like to do on best, it will corner the market by taking over Nintendo for both hardcore and the casual market which have already been broaden by Nintendo. Both hardcore and softcore, motion sensing and traditional, HD and SD will all belong to Microsoft. You just need to wait, it is just the matter of time.

rocketpig said: Dragon007 said: rocketpig said: Aj_habfan said: Here's why some people think 360 is dead: 1. It is selling the least every week worldwide since late last year, even after a $100 price cut in Europe 2. It is dead in Japan and lost it's major lead in America 3. People feel it has used up all it's big software hitters, so it's only downhill from here 4. People think it's sales peaked at Halo 3, and now people are moving on to the other consoles I'd argrue those points, not a Microsoft person saying how good of a job his team has done. 1. Yes, it's selling less than the PS3 and Wii... It's also selling more than it did in 2007. Since when is significantly increasing sales "dead"? MS is making money right now and after a dreadful six years in the industry, they need that more than anything. 2. Yes, but it was always dead in Japan. Nothing has changed there. America badly needs a price cut. 30 months with one stinkin' $50 price cut is not helping their cause. 3. Gears 2. Banjo 3. Halo Wars. Fable 2. Ninja Gaiden. If anything, the 360's software is stronger in 2008 than it was in 2007... It just doesn't have Halo 3 but if you look at the numbers, Gears isn't a bad replacement at all. 4. See point one. If its sales peaked with Halo, why is the console selling far and above its 2007 numbers? It doesn't matter how well it sells in contrast to..itself, it matters how well it sells in contrast to the competition. I don't think the 360 is dead, but it's certainly heading for 3rd place. It absolutely does matter how it sells in comparison to itself and its predecessor and it matters how much money is made from the product. Or maybe companies like Apple should consider their Mac line dead because other companies like Dell and HP are trouncing them in pure sales numbers.

It doesn't matter in terms of their position in the console war, they can sell a million more units than they did last year, but it won't make a difference if the competition sells 2,3 or 4 million extra units.

The 360 isn't dead yet, but they're heading for last place which isn't a good thing any way you look at it. They're going from 2nd place (last generation) to third. 

The place the Xbox finishes is irrelevant to their entertainment division. Sure, they would like to finish first, as would everyone.

I'm sure MS is perfectly happy sitting on a 360 that is turning a profit and is poised to sell up to 80% over its predecessor. Sure, it will finish in third place but I guarantee you that MS will take that market gain and profit over a second place finish and $5b in losses.

You need to stop looking at this like a consumer/fan and realize what MS is doing and why the Entertainment division is showing signs of longterm viability as a result.

Aj_habfan said: Here's why some people think 360 is dead: 1. It is selling the least every week worldwide since late last year, even after a $100 price cut in Europe 2. It is dead in Japan and lost it's major lead in America 3. People feel it has used up all it's big software hitters, so it's only downhill from here 4. People think it's sales peaked at Halo 3, and now people are moving on to the other consoles I'd argrue those points, not a Microsoft person saying how good of a job his team has done.

1. Actually, It's sales went up about 40% in europe, so it did help.

2.  You are stupid if you think the ps3 has already beaten the 360 in america. Only right now is it ahead. (week  to week, and that's not by much)

3.  That's only what you think buddy, you hate the 360.

4.  If a person likes the Xbox360's software, why would he get a console he might not like?

 

 

BTW, welcome, I also came from gamespot.

Gamer1211 said: Final-Fan said: I don't know how much good it will do as it sounds like your opinion is pretty much set in stone, and your post reads more like propaganda than the start of a real debate, but I still want to say a couple of things: Who has said that Blu-ray will destroy the 360? What I heard people saying was that Blu-ray would destroy HD DVD, which it did, and that it is a better storage medium for games than DVD, which you have not argued against. Who here has said that the 360 is dead? Only the most rabid of PS3 boosters here have said even that it is "dead in the water" which is far from "dead". Next time you lecture an entire forum, try arguing against something most of them believe. Such as, for instance, the fact that the PS3 has outsold the 360 consistently throughout this year so far (WW). Your widget example was just painful to look at. Hopefully, if you stick around, you'll do more than spew "xbot"-level propaganda, since there is a bit of a shortage of 360 fans around here. 1. Many PS3 fanboys claim that Blu Ray will be the deciding factor in the console war. Go to gamespot and u will see what I am talking about. 2. Umm if you goto Forums and gaming you will see that there are 3 threads talking about the 360 being dead. Moreso, If you goto Gamespot or IGN you will at least 10 so please dont advise me to post about something that is clearly widespread throughout the gaming community. 3. Yes the PS3 has sold the 360 3 out of 4 months this year. I never disagreed or stated anything disputing that and as such I am unsure what you point was. 4. Widget example was to simply prove a point. Based on the types of threads that are posted its not a good assumption to believe that everyone can understand logic when it comes to consoles. Spelling something out to me would be much more effective then posting my opinion. 5. Propaganda? If you could please direct me to your source that discredits or proves that anything I posted is false or does not have fact to back it up.

1. Are we on the gamespot forums? No. In fact we frequesntly laugh at the ignorance rampant there, which would include talk of the 360 being "dead".

2. I didn't see them on the first 3 pages. Please point them out, I admit I skimmed but the closest I saw was a troll thread on Page 2 about GTAIV making 360s brick; the poster got banned and everyone laughed at the article.

4. The widget example was not even remotely on point. How was it a useful analogy for the 360 vs. PS3? Just because the 360 managed to claw its way to profit a little bit faster doesn't mean it didn't employ the same strategy of losing money on the hardware to make it up on software and later in the gen.[*] I agree that spelling out one's argumentation is a good thing; I don't think you did it enough.

[edit:  In short, you say you did the widget example to prove a point but I don't know what you think you were proving.  It's pretty obvious to all that it's better to make money per unit rather than lose money per unit.  You don't need an example to show that and it's NOT what you needed to prove to support your argument.  As it stands your widget example is such a gross oversimplification of the strategy MS and Sony both employed that it loses all relevance to the discussion. 

[*There is also another point to consider:  Sony also was employing the same strategy with respect to Blu-ray inside the PS3 at the same time as it was doing so with respect to the PS3 generally.  So it has even more to potentially gain from that (successful) strategy.]

5. Propaganda doesn't have to be false. I will address this point more fully when I get home from work.