Not to turn this into a Mac vs PC thread, but if you take gaming out of the equation, there is not a single reason to buy a PC over a Mac. Linux is not a bad solution either, if you can live with old versions of Office.

One of the things that keeps the PC industry where it is, is gaming. I just spent $750 on a new Gaming PC, and installed Vista. Apple does not have an alternative for me (as I type this on my Mac Book Pro).

It's hard to quantify how much gaming has meant to Microsoft, but it's a lot.

Overall, I think that the cost of goods sold is well below that of the revenue they bring in.

The issues of profitability come from other aspects of running the Xbox - developer moneyhatting, marketing, and other "ect" ideas. The Xbox 360 is most likely rather profitable right now, and is allowing for agressive spending on acquiring new IPs from 3rd parties.

However, Microsoft needs a more Nintendo-esque strategy: get more developers for first party projects. Microsoft has made hundreds of millions off of the Halo franchise. MS needs new IPs, and more staffing to go along with them: ultimately, making money as a hardware company needs to come from selling the vastly more lucrative software. Nintendo makes their killing on the endless, mindless Mario and Touch titles, not the hardware itself (having said that, the hardware makes them a tidy profit too).


Think about it: the 360 has about a 7.0 or even 8.0 attach ratio...Microsoft might make $50 a console, but if it sold a decent bit of 1st party software, (lets say 2 titles/console), then it's making more money via software than hardware. Nintendo does this very effectively by clogging it's system's software sections with 1st party titles, netting them billions.

Wrong.  Businesses are M$'s main money market.  They are in heavily with businesses which is one of the main reasons why Windows is so bloated.  They must keep all businesses legacy code working with newer operating systems.  Other OSs do not have this problem.  Microsoft works very hard at helping businesses incorporate their software whereas other companies do not.  Apple does not have very good customer support for big businesses and quite honestly they do not care to.  They enjoy their market of trendy people and artists.  Gaming is a good way for the masses to keep with Windows but as long as businesses continue to develop and interate with Windows, M$ will continue to rake in the cash.

.... yes I'm sure everyone is rushing out to buy PCs so they can play Cyrsis. Somehow I think price and the ability to run all those wonderful windows based aplications is a tad bit more important.

Anyhow the 360 is still deep in the red and it's ability to reach the black by generations end might be due more to Microsoft bookkeeping (shifting more debt to other profitable areas of the entertainment division) than it's own profits.

It's funny. The world changes very fast these days, but peoples perception of the market place does not. Apple is no longer the system for hippies and artists. It's a very powerful business machine. Many companies have moved to web apps for almost all of there internal applications. I am not sure if you work in an office, but if you do, how often do your employees use something other then a web browser, or an MS Office tool? Most people never do. The biggest issue that stands in the way of a company like Apple taking over the business world, is IT training.

Apple is already clost to 20% market share in the US, and that is not all homes.

20%? i don't believe you at all.

sorry buddy, you are a horrible liar. The best i could find is mac market share at 7% and that was at its peak. Most people who use macs use them for creating movies, music, or art. Have fun in fantasy world.

Macs look nice though.
Almost bought one but it is still too pricey for me. I can put together a decent together for less than 1/2 the price of a mac.
For everyday personal or small business use, Pc is still king and will be for a long time.
Their next touch screen OS is going to be awesome as well.

OT:  I don't think MS would be in gaming business if they thought they couldn't erase the debt and start making money.

umm where are people getting the 1.5 billion in total losses from.

M$'s FY06 = 1.28 billion in losses. ( Thats 1st July 2005 - 31st June 2006)
M$'s FY07 = 1.89 billion in losses ( 1st july 2006 - 31st June 2007)
M$'s FY08(Q1-Q3) = approx 550 million in profit.

360 wasn't released till Q2 FY06. So Q1 profit / loss should count towards the Xbox not the 360.
M$ FY06 Q1 = 141 million in losses.

So M$'s losses on 360 in FY06 was 1.14 billion.
FY06 + FY07 losses = 3.03 billion.
(3.03 billion) + 0.55 = 2.48 billion.

Therefore Microsoft is 2.48 billion in the red on 360.

Thanks for the personal attack. Here are some of the many articles that report Apple at 14% at the beginning of 2008, with 60% growth the last 2 years.

I guessed that 6 months into this year, they are approaching 20%, provided the trend continues. (60% would mean 22% by the end of this year).

http://blogs.zdnet.com/hardware/?p=1520

http://www.i4u.com/article15562.html

http://blogs.eweek.com/applewatch/content/channel/macs_defy_windows-gravity.html

http://www.appleinsider.com/articles/08/03/17/apple_snags_14_percent_of_us_based_pc_retail_sales_in_february.html

http://arstechnica.com/journals/apple.ars/2008/03/18/apple-spanks-rest-of-computer-industry-in-february-sales

Anytime you want to aplogize for calling me a liar, I will accept it.